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Let’s talk about long term care in your financial plan

Jun 16, 2021 | Heather Krause


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June is Alzheimer's & Brain Awareness Month. It’s time to start thinking about Long Term Care as part of your financial plan.

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Back when I was young, there was not much talk about Long Term Care planning.  Life expectancy was shorter than today, and it was assumed my parents would be taking care of their parents like generations past.  Today it is different, and many Baby Boomers, Gen Xs & Gen Ys are facing what is now being called the ‘Sandwich Generation.’  These generations are finding themselves not only taking care of their families, but also their aging parents and other family members, especially as life expectancy has increased and couples have delayed starting their own families.

Facing cognitive decline in parents or other family members can be a very sobering and exhausting experience. One of my coworkers was confronted with this very challenge—her mother was experiencing cognitive decline and was no longer able to take care of herself. She needed fulltime assistance and the family started to look for assisted living facilities.  It became clear how expensive this was going to be! Her mother did not have a LTC policy in place, so I had to watch as her family sold off her mother’s assets, including her home, to pay for her care. This kind of financial and emotional stress may be reduced by having a LTC plan in place.  Many private plans today allow for care in one’s own home—even given by family members—and offer death benefits to beneficiaries if the policy is not used, so money isn’t “thrown away” on something that was eventually not needed.

Recently, Washington State has enacted the nation's first state-operated long term care insurance program, the Washington State Long Term Care Trust Act, which takes effect January of 2022.  The Trust will be funded by a mandatory payroll tax of 0.58% of individual W2 income.  

There is a small window to opt out of the state plan by purchasing your own Long Term Care policy before October 1, 2021.  We recommend that you understand the pros and cons of the state plan versus a private plan.  Please contact us so we can review with you how the legislation may affect your plan, including considerations of any group LTC insurance offerings you may be eligible for through your employer.  

For those not in Washington State, we can help with your LTC planning needs as well.  We evaluate and solve for insurance needs, including Long Term Care considerations, as part of our comprehensive Wealth Plan process.  

Let us help you evaluate what is best for you and your family.

Heather was named a Forbes Top Wealth Advisor and Working Mother’s Top Wealth Advisor in 2020 & 2021.  She is the principal advisor on the multi-generational Krause & Thorpe Wealth Management Team, helping busy families build and preserve wealth.  

#krauseandthorpe #nationalalzheimersawarenessmonth

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Disclosures

The views presented herein are solely those of Heather Krause and do not necessarily represent the views of RBC Wealth Management. The current status of issues discussed in this article is subject to change based on market conditions and industry fundamentals. Clients should work with their Financial Advisor to develop investment strategies tailored to their own financial circumstances. Past performance is no guarantee of future results.

The 2020 Working Mother Magazine's "Top Wealth Advisor Moms" award was announced September 2020. Data as of 3/31/2020. SHOOK considered women advisors with children living at home under 21 years of age. The ranking algorithm is based on qualitative measures derived from telephone, virtual and in-person interviews and surveys, considering factors such as: service models, investing process, client retention, industry experience, review of compliance records, firm nominations, etc.; and quantitative criteria, such as assets under management and revenue generated for their firms. Investment performance is not a criterion because client objectives and risk tolerances vary, and advisors rarely have audited performance reports. Investors must carefully choose the right advisor for their own situation and perform their own due diligence. SHOOK’s research and rankings provide opinions intended to help investors choose the right financial advisor and are not indicative of future performance or representative of any one client’s experience. Past performance is not an indication of future results. The financial advisor does not pay a fee to be considered for or to receive this award. This award does not evaluate the quality of services provided to clients. This is not indicative of this financial advisor’s future performance. For more information, please see www.SHOOKresearch.com.

The 2021 Forbes "Top Women Wealth Advisors" award was announced March 2021. Data as of 9/30/2020. The award was developed by SHOOK Research and is based on in-person and telephone due diligence meetings to evaluate each advisor qualitatively, a major component of a ranking algorithm that includes: client retention, industry experience, review of compliance records, firm nominations; and quantitative criteria, including: assets under management and revenue generated for their firms. Investment performance is not a criterion because client objectives and risk tolerances vary, and advisors rarely have audited performance reports. Rankings are based on the opinions of SHOOK Research, LLC and not indicative of future performance or representative of any one client’s experience. The financial advisor does not pay a fee to be considered for or to receive this award. This award does not evaluate the quality of services provided to clients. This is not indicative of this financial advisor’s future performance. For more information: www.SHOOKresearch.com.

Heather Krause, NMLS # 1877718 through City National Bank, may receive compensation from RBC Wealth Management for referring customers to City National Bank. Banking products and services are offered or issued by City National Bank, an affiliate of RBC Wealth Management, a division of RBC Capital Markets, LLC, Member NYSE/FINRA/SIPC and are subject to City National Banks terms and conditions. Products and services offered through City National Bank are not insured by SIPC. City National Bank Member FDIC.

Investment products offered through RBC Wealth Management are not FDIC insured, are not guaranteed by City National Bank and may lose value.