Safe Money - 6-1-24

Episode Transcript

(00:00):
Good Saturday morning twelve on this firstSaturday in June twenty twenty four, Dick
Schuldar here, and this is safemoney. We have been here for lots
of years now, suggesting to ourlisteners strategies we use with our clients to
manage and protect assets, and tomanage and protect those assets safely in today's

(00:25):
very unsafe world. I want toremind all of our listeners and all of
our clients that the conflict between UnitedHealthcare and Genesis continues. I was hoping
to have better news for you thismorning, but as of this recording,
I don't have better news. WhatI know is discussions between the two entities

(00:47):
between Genesis and United health Care continues. Recall listeners. United Healthcare continues to
provide coverage with Genesis until first.We hope to have some resolution to this
conflict, to this conflict prior toJuly first. I was hoping to have

(01:08):
that resolution for you today, butthat's not the case. I will keep
you posted as this conflict between Genesisand United Healthcare develops. Feel free to
contact us that five sixty three threethree two twenty two hundred to express your
concerns, but we will keep youposted. As these discussions continue and a

(01:34):
potential resolution is achieved. June firstalso brings about the last month. On
the second quarter of twenty twenty four, the stock market continues to remain steady.
This morning's Safe Money is a recording, but as we approach the end
of the second quarter, the stockmarket continues in a relatively stable mode.

(02:00):
As I mentioned, almost every SafeMoney program we have, I have those
bar graph charts available in which wetrack the history of the Dow, the
history of the S and P fivehundred, and the history of the Nasdaq
one hundred. These charts give anice history of the stock market by tracking

(02:21):
the calendar year performance of the marketand of the major indices, the Dow,
the S and P five hundred,and the Nasdaq. As I mentioned,
these charts give a nice history ofthe market by tracking the latter years
of the decade of the nineteen ninetiesthrough the first quarter of twenty twenty four.

(02:46):
Call us for me. Email meif you'd like to have a copy
of these bargraph charts. Call meat five sixty three three three two twenty
two hundred, or go to mywebsite ww W dickshillig dot com. And
screw over to the contact icon formy email address. Send me an email

(03:08):
explaining your situation to determine how wecan help you. Our generous bonus annuity
continues a thirty five percent bonus,so that is very, very attractive.
Then once that bonus is added,then you continue to share in the growth

(03:31):
of the stock market, not inany of the downturns of the stock market.
So that's a nice, nice additionto your account value. Now,
i'd like to last Save Money program. We talked about some of the healthcare
risks that we are faced with aswe age, as we approach age sixty

(03:55):
five and beyond, and one ofthose healthcare risk is the risk of the
costs of long term care. Longterm care. There was an article in
the Quad City Times in the lastweek or two and the article was put
thereby by Terry Savage. She's aregistered investment advisor and author of four best

(04:25):
selling booklets, including The Savage Truthon Money. Terry responds to questions on
her blog as Terry Savage dot com. But last week she had an article
in the Quad City Times entitled fundinglong term care insurance. Remember last week

(04:46):
we talked about the premium for longterm care insurance and that premium is very
expensive. Now. Terry in herarticle an option that you have in order
to fund long term care insurance,and she goes on to say that the

(05:06):
most unexpected and the costly expense ofretirement is the need to pay for long
term custodial care, a burden thatis not covered by Medicare or Medicare supplements
or Medicare advantage plans. No onewants to think about needing help to eat,

(05:30):
or needing help to shower or dothe basic activities of data living,
but you ignore the possibility at yourperil. For twenty twenty four, the
project the projected national average cost ofassisted living. Now the average cost of
assisted living on the national average isfive thousand, six hundred and sixty five

(05:58):
dollars per month and far higher inmajor cities. The cost of in home
care, even part time home care, could nearly double that amount. Once
you retire, the odds of needingthat care increased dramatically according to the Department

(06:20):
of Human Services. They state thatseventy percent of adults who survived to age
sixty five developed severe long term servicesand support needs before they die, and
forty eight percent receive some paid careover their lifetime. Now, Terry Savage

(06:50):
goes on to say that my apologyfor scarying you with this reality check,
but brings a solution, a relativelynew way to help pay for long term
care insurance. And she reminds usthat long term care insurance is expensive and

(07:12):
traditional policies are subject to increases inpremiums, and that led to more interest
in a combo policy which combines longterm care benefits with life insurance. So
if you don't need care, yourbeneficiary really will receive ultimately a death benefit

(07:32):
from that policy. The latest twistis a creative way to play. The
latest twist is a creative way topay for these premiums. You can use
your IR to purchase this policy,pay for it over a full ten year
period, and get your long termcare benefits tax free, and have a

(07:57):
death benefit if the air portion isnot used. Even better, this policy
makes great sense for married couples whoget a discount on the cost when it
covers two lives. The concept isit revolves around doing a tax free rollover

(08:20):
of a portion of your IR aretirement money into an annuity. Now,
this is not like investment annuities I'veadvised you to avoid, she says.
Instead, this annuity is designed topay out once a year for ten years,
to pay directly for the premium ona life insurance policy that contains a

(08:46):
long term care insurance writer. Theannual distribution to pay the premium is taxable
to you, so you'll receive aten ninety nine for the annual amount can
cost as part of your required minimumdistributions. If you're over seventy three,

(09:07):
you don't actually get the money,since it goes into the life insurance policy
which pays for the long term careinsurance coverage. Once the ten year payment
is completed, there will be nofurther premiums Now, you need a qualified
expert in long term care insurance towork out those numbers for you, and

(09:31):
Terry Savage says she turned to aexpert whose agency specializes in only long term
care insurance, and that agency ransomnumbers on the cost of by one America
asset care policy described for two scenarios. It gives six thousand dollars a month

(09:56):
in unlimited long term care benefits andcan be used for any level of care,
either assisted living, full nursing air, full nursing care, or home
healthcare. This is the scenario.A sixty two year old woman in good
health could pay fifteen thousand, sixhundred and fifty dollars per year for ten

(10:22):
years to purchase a policy, orshe should get a significant discount if she
paid the entire amount upfront, andthe cost of that would be little over
one hundred and twenty five thousand dollarsas a single premium. That's a huge
amount. But wait, the moneyis setting in her ira invested very very

(10:50):
conservatively, so if she uses itin the strategy described to purchase an annuity
that automatically pays it policy premium forover ten years. If she happens to
die over that ten year period,then her beneficiary gets a death benefit of
more than two hundred and fifty thousanddollars. A married couple, husband sixty

(11:16):
five and wife sixty two get aneven better deal. Jointly, they could
pay twenty one thousand dollars a yearfor ten years to get this same type
coverage, but the one time premiumfunded over ten years using the strategy mention
of an annuity would be one hundredand sixty eight thousand dollars. Again,

(11:41):
it's a very very large amount.But if you rolled out a IR into
an IR annuity to pay the lifepremium, they would each have a six
thousand dollars per month lifetime long termcare benefit tax free, and one hundred

(12:03):
and fifty thousand dollars life insurance benefiton the second to die. Yes,
it's a complicated strategy, but inthe long run, this strategy works,
and it works very well using IRAfunds. Remember with IRA funds, that's

(12:24):
qualified money, and we are requiredat age seventy three to begin withdrawing some
portion of that IR over our lifetime. So what Terry Savage is suggesting is
that if you have an IRA,you could use a portion of that IRA

(12:45):
to help fund this long term carepolicy. And remember it is a long
term care life insurance policy, soit has a value or a benefit for
long term care purposes as well asa benefit for life insurance purposes. So
if you'd like to have additional informationabout that, please give me a call

(13:11):
call me at five sixty three threethree two twenty two hundred, or email
me go to my email address,go to Dick Shilling dot com and that's
my website and scroll over to thecontact I can pick up my email address
and drop me an email. Tellme about your situation. Long term care

(13:35):
costs is a risk. It's ahealthcare risk. It's a risk to our
assets. My gosh. If welook at the cost of the national average
cost of adult facility is over fivethousand dollars a year. For assisted living,
the cost is not much less thanthat. The cost is about forty

(13:58):
eight for home health care. Homehealth care depends upon the amount of home
health care we receive. It canreceive every bit as much as the costs
of facility costs. So it's astrategy that you can use. It's a
strategy that's available by using money thatyou currently have, perhaps money in a

(14:26):
ire converting that portion of that IRAinto an annuity that would pay sufficiently for
a premium for long term care insurance. Today's long term care insurance. There
are provisions that you pay for thatpolicy annually, and you pay it for

(14:48):
your lifetime or until you have aclaim and then you no longer pay the
premium for that long term care insurancepolicy. Another option is some long term
care care insurance policies have limited paybenefits limited pay premium so that you don't
pay the premium forever. That youpay a premium maybe first limited period of

(15:11):
time like ten years, and youstill retain the benefit. You retain the
long term care benefit. So encourageyou to take a look at that.
That's an important strategy in your planninglisteners. That's something that everyone should plan

(15:31):
for. Should plan for the riskof long term care. That's a healthcare
risk. And remember when we talkabout the risk to our assets when we
retire, one of those risks wasa healthcare risk, and that healthcare risk
includes long term care costs, andthe cost of long term care can be

(15:58):
partially addressed by the long term careinsurance. Now, long term care insurance
is complicated. Long term care insurancesometimes is difficult to acquire because full underwriting
is required. But if you qualifyfor long term care insurance, that's one

(16:21):
obstacle you need to overcome in doingyour planning. The other obstacle you need
to come you need to overcome ishow to pay for long term care insurance
premium using qualified money using your assetsthat you may have in iris or four

(16:42):
one case is a partial solution tothat problem because those assets you need to
tap on for withdrawal purposes. AndUncle Sam says at age seventy three,
we need to take a certain amountout of our qualified money, out of
our IRA accounts or four to oneaccounts, and we need to take out

(17:06):
a certain amount every year so thatpremium that would be could be paid for
partially or in full by using thatstrategy. So that's something I encourage you
to take a look at. Ithink is very very important that we do.
So I want to remind you againduring this month of June, on

(17:30):
June eighteenth and June twentieth, wehave our monthly virtual community meetings on which
we talk about On June eighteenth,we talk about the risks of Medicare and
the options that are available for Medicare, and we talk about the original Medicare

(17:56):
in which we have a Medicare providedby Uncle Zam for Part A and Part
B, and then we have aMedicare supplement policy provided by an insurance company.
And we have a third policy andthat is a Medicare prescription drug car
provided by a private insurance company.That's one way of helping to address the

(18:21):
issues for Medicare. On Thursday,June twentieth, we have a second virtual
community meeting in which we talk aboutagain the basics of Medicare, and then
we focus on talking about the alternativeto original Medicare, and that alternative is

(18:42):
an advantage plan, and in particular, what we feel is the more competitive
of the advantage plans in these regions, and that plan is the one offered
by United Healthcare, and that isthe AARP advantage Plan. Now, AARP

(19:02):
is not the insurance company. Theinsurance company is United Healthcare. AARP merely
sells our logo to United Healthcare.United Healthcare then can use that logo on
the products that they market. Ibelieve that United Healthcare offers one of the
more competitive of the Medicare advantage plans, and that is the AARB Medicare advantage

(19:27):
plan offered by United Healthcare. Andagain, the insurance company is United Healthcare.
The insurance company is not AARB.I want to remind you as of
this and you probably know this,but as of this recording, we still
don't have results on the conflict betweenGenesis and United Healthcare. And recall that

(19:55):
there was a newspaper report that UnitedHealthcare would no longer offer Genesis services to
Genesis effective on July first. Ihad hoped at this point that we would
have a resolution to that problem,and as of today, as of July
first, we do not yet havea resolution to that problem, but I

(20:18):
would anticipate a resolution very very soon, because the coverage for Genesis would discontinue
as of July first. Now,with that discontinuation, that entitles you United
Healthcare Providers to obtain other coverage.That would open up a special enrollment period

(20:42):
for you, and I think youwould have the option of acquiring additional coverage
if that was in your best interests, So keep that in mind. Calls
at five point sixty three three threetwo twenty two hundred, or go to
my website and email me. Goto www. Dickshillick dot com scro all

(21:06):
over to the contact icon to pickup my email address. We'll be happy
to correspond with you via email ifyou'd like to have a copy of these
bargraph charts on the performance of themarket since the latter part of the nineteen
nineties, we were happy to provideyou with that. I use this bargraph

(21:29):
charts when I talk about when Italk about our annuities, our safe money
harbor annuities our indexinuities. Because onthe indexinuities indecceduities participate in the growth of
the market, then do not participatein the downside of the market. So

(21:52):
as the stock market declines, youraccount value in your indexinuity remains the same.
If the market increases in value,then the account value of your index
ainuity would also increase in value.Those are two fantastic ways of helping provide

(22:12):
for the costs of not just longterm care, but the cost of living
and the cost of expenses in ourretirement years. So I'd be happy to
share those strategies with you again.Give me a call at my phone number
five sixty three three three two twentytwo hundred, or go to my website.

(22:37):
Go to www. Tic shilling dotcom and scroll over to the contact
icon and pick up my email addressand send me a correspondence via email.
Again. Our meetings for the monthof June our June eighteenth. It's a
Tuesday, June eighteenth and Thursday Junetwentieth. On Tuesday June eighteenth, we

(23:03):
talk about the basis of Medicare andthen focus on the Medicare supplements. Remember
there are ten Medicare supplements. Weget to pick one of those ten Medicare
supplements. And there are eighteen prescriptiondrug plans. We get to pick one
of those eighteen plans. So itis a very complex issue. I feel

(23:27):
by attending these meetings you would beable to pick up some insight on the
choices that you have and be ableto make a good decision. We have
an attendee, or most attendees atour virtual comedings, they tell us at
the end of the sessions that theytell they say, now I understand the

(23:51):
choices I have for Medicare, soI'd be happy to share that with you
again. Give me a call orsend me an email if you'd like to
have a copy of these bar graphcharts. I think you would find that
information on these bar graph charts tobe very helpful information. We track the

(24:11):
history of the Dow, we trackthe history of the Nasdaq, and we
track the history of the S andP five hundred since the latter part of
the decade of the nineteen nineties.I picked that period of time, the
latter part of the decade of thenineteen nineties, because it was about that
time that I was introduced to theseindexinuities. And remember an index annuity is

(24:37):
a safe money harbor. An indexinuityshares in the positive It shares in the
growth of the stock market, andindexinuity does not share in the downside of
the market. So your account valueand an indexcelluity will increase if the market
increases, but if uses, ifthe market declines, you will not share

(25:04):
in any losses in stock market declines, your account value will stay the same.
So if you'd like to have acopy of these index barograph charts,
I'd be happy to send those toyou. I think you would find those
very very helpful and very very educational. And as we look back on it,

(25:27):
as we can recall those years,we can recall the last twenty seven
and a half years of our workinglifetime and recall the positives and the negatives
during the course of those years thatwas reflected in our four oh one k
programs and we all shared in thatinformation over the years. So again,

(25:52):
call me five six three three threetwo twenty two hundred or email me.
Go into my email address, goto Dick Shilling dot com, stroll over
to the contact icon for my emailaddress. Good talking to you this weekend.
Have a great, great weekend.Good day,