• Sarah Smith, Tenaya Insurance

The Biggest Threat You Probably Aren't Aware Of


When I was a teenager, my father and I were in the kitchen one day when he told me that him and my mother were purchasing long term care insurance. In my young, oblivious mind, I asked my dad “why are you buying that? You have four kids who could take care of you or pay for things if something ever happened to you guys.” My dad’s response was “Because it’s not your responsibility. Mom and I can make sure we’re taken care of so you kids don’t have to worry about anything. We don’t want you guys burdened with that.” As a teenager, I didn’t know what I didn’t know. I didn’t have the life experience under my belt to realize the monumental risk my parents were protecting us (and themselves) from. But that’s my parents. They always planned ahead, and had things in order. They protected themselves and their children from risks. They had things in place for the “what if’s” that life can throw at you. This was the example that they set for their children.

As an adult, I get it, and the kicker is now I work in insurance, protecting families and their assets from all of life’s risks, by providing them with solutions like the ones my parents put in place when they had a young family.

Earlier this year, I got another reminder of how vitally important these types of policies are, and just how beneficial they are to your family. My life changed forever on March 9th, 2017 when my father passed away unexpectedly. My world had just changed forever, and nothing would be the same again. My siblings and I lost our father who we were very close to. My mother lost her husband of almost 45 years. My nieces and nephews lost their grandfather who had a special relationship with each one of them. He was far too young as he was only 67. But in his passing, he was still taking care of my mom, and in turn his children. At a time when my mother was dealing with such a huge loss, the things that my father put in place 20 years earlier had put my mother in a position where she wouldn’t have to worry about how she would pay for any long term care should she need it in the future. 70% of people over the age of 65 will need long term care at some point in their lives, so the odds that she will need care at some point are very high.

The policies my parents bought had a clause that specified that if one of them passed away, that the surviving spouse would retain their long term care coverage for life, and they would never have to pay another premium again. This was huge. It’s security, and peace of mind. He cared enough about her to make sure that she would always be taken care of. Whether he was here or not. He protected her from having to worry about how she’ll pay for it, or if she’ll have to liquidate her assets to cover these costs so that she could receive the quality of care that she deserves. She’s covered. My parents never thought that my dad wouldn’t live beyond age 67. That’s the thing about life . . . you never know. But they had prepared for it just in case, and this is exactly what these plans are for.

As I saw my mother dealing with the aftermath of losing her husband I had an up-close and personal view of how the steps my father took years before made this process so much easier on my mom. From the long term care policy they purchased, and the life insurance policy he got in the ‘80’s, and making sure they had their living wills, and advanced directives, etc. long ago completed and kept up to date, everything went so much smoother for my mother. I have heard story after story, especially in my line of work, of what has happened when the time was never taken to put a plan in place. It can be a devastating and steep price to pay.

This is the crux of what long term care insurance provides. It gives you options, and allows you to decide how and where you receive care should you need it. Do you want to stay at home to receive care? It will ensure that happens. Are you more social and you’d like to move into a facility that has activities, and social events, as well as care services should you need them as you age? It will see to that. Do you want to throw a shield of protection around your assets and estate that you spent your whole life building from being obliterated from having to pay for long term care out of pocket? That’s what it’s built to do. Do you want to make sure you will not have to burden your children from having to pay high nursing home bills, or for full time caregivers out of pocket? Is it important to you to protect them from the physical, emotional, and mental stress of having to be a caregiver, and instead allow them to care about you, not for you?

Long term care insurance is a promise that in what can be one of the hardest times of your life, you will still be in control. You will still have options. Your family can care about you instead of stressing over how they’re going to come up with the huge sums of money to pay for it. You have transferred the financial risk off of yourself and onto an insurance company to shoulder.

Paying out of pocket for long term care services is so incredibly expensive, the monthly premium on a policy to safeguard you from having to do this is not. Like everything else nowadays, the costs for Long Term Care services continues to rise every year. One year in a nursing home now costs as much as tuition at an ivy league college! Only you don't get the fancy degree at the end, you just have a drained bank account.

There is such a high likelihood that we will find ourselves needing long term care at some point in our lives because we are living longer than ever before. This is a good thing, but it also has it downsides. One of those being the fact that the money we’ve spent our entire lives saving for retirement now has to last us for a longer amount of time. How many of us can afford to take the kind of financial hit that paying for long term care can deliver, and still be able to maintain our lifestyle? Or put food on the table? Maintain our independence? Have a choice in how and where we receive care instead of having it dictated for us? For these reasons long term care has become one of the biggest and most serious threats to our retirement today.

Unfortunately, it's a subject that most people know little about. Just how expensive these services really are is unknown to most people unless they’ve had a personal experience with it (caring for a parent or grandparent whose needed it). And when they do experience it, it’s shocking, and they want to prevent their own kids from having to experience it. There are so many misconceptions out there and assumptions that are commonly made when it comes to this subject, and not knowing fact from fiction can lead to disastrous results for you.

So with November being Long Term Care Awareness month we can think of no better time to kick off a conversation about this very important subject. Because at the end of the day, the person who will pay the price for not being prepared and having a plan in place is you and your family, and we're not okay with that as there’s no need for it. You have options.

We are going to demystify long term care for you and answer some commonly asked questions in the month of November. Like “What is Long Term Care, and does it only pay for nursing homes?”, and clarifying long believed myths such as “Medicare pays for long term care, so I don’t have to get a plan in place for how I’ll pay for it” and much more.

So if you’ve ever been curious to learn more, or if you have a parent (or grandparent) who you think could benefit from learning more about this important topic, share this article with them so they can learn more this month in our upcoming weekly posts. We look forward to simplifying this subject for you as we are passionate about helping people protect their families as well as the assets they've worked so hard to build. I've seen what it's done for my mom and countless others, and we are committed to bringing this same protection to each and every family.

Have questions about Long Term Care that you would like us to answer on future blog posts this month? Send them in, we'd love to answer them for you! Either throw them in the comment section below, or email us at: info@tenayainsurance.com

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Don't want to wait to put a plan in place? Give us a call, we're here to simplify the process for you. Call Tenaya Insurance Services today at (925) 322-8073.

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