An Annuity Can Help Pay for Care

Long term care is costly, and could quickly drain your savings. Long Term Care (LTC) insurance is perhaps the best-known option for offsetting these costs, but rising premiums and the ability to qualify render coverage out of reach for many.  An annuity can be an alternate option for funding care.

Annuities with LTC Benefits

An annuity is an insurance contract that converts your premium into a steady stream of  income for a specified period of time. You may add optional LTC benefits to an annuity contract to help cover LTC costs. The annuity creates a fund specifically for LTC expenses and a separate cash payment fund for however you choose to use it. Payments from the LTC fund are triggered in the event you need care. The monthly LTC payout is typically a multiple of your normal monthly income stream from the annuity. If you end up not needing it, you can pass the value on to your beneficiaries.

Annuities with LTC Benefits are available for those up to age 85 and have simpler underwriting requirements than LTC insurance. If you’re looking for steady monthly income, protection against outliving your assets, or you would benefit from simplified underwriting, you may want to consider an Annuity with LTC Benefits.

Another Option

You can always purchase an annuity without the extra LTC benefits. The insurance company will pay you a specified monthly income in exchange for your single premium payment no matter your health status. This is ideal if you are already receiving care or if you do not quality for other options due to poor health or age.

There are myriad annuity choices and the related tax implications can be complicated, so it’s best to consult with an Advisor to explore your options.

Learn more about Annuities and how to connect with an Advisor.