Have you ever noticed just how many Go Fund Me accounts and charities there are asking for money to help pay for care of a family member that has suffered an illness or accident? There are a lot!
Without proper planning, irreversable damage may occur to our financial future unless we discuss Medicare, long term care, and disability. Of course, these are not fun topics to discuss, but are extremely important.
Disability Income Insurance (DI)
Also known as paycheck protection, how many of us have enough in savings should something happen and we can’t work? The answer is not many. Imagine being in your prime earning years and suffering a serious accident or illness. Instead of planning for the future you find yourself thinking about which bill, insurance, or investment to cancel to feed your family.
Long Term Care Insurance (LTCI)
LTCI is also a type of DI protection. LTCI isn’t protecting a paycheck per se, but is insuring against unexpected expenses. Americans work hard for the paycheck, and at some point the paychecks will end… at least that is the goal. We work hard, then play hard. The goal is to save enough so that we may travel, buy gifts for the grandkids, and simply enjoy life while our health is still intact. It is when we are working hard that we need a plan for extended care. Very few of us plan for such a day, unfortunately. You don’t need a huge Long Term Care policy, but you need something. Extended care planning is nothing more than an income stream to pay for care as a result of a disability once retired.
Medicare
Medicare does not cover custodial care for extended care needs, and it does not provide an income stream for care not covered by Medicare.
We must plan for unexpected expenses. Without doing so will likely be financially devastating.