Transcript Document

Secure your
retirement future
Managing the financial
risk of long-term care
Name
Title
Date
LFD0603-0385
Protect your retirement income
Few things matter more than your
retirement assets.
Protect them against the threat
of long-term care.
©2006 Lincoln National Corporation
www.LFG.com
LFD0603-0385 MG-1422-06 11/06
2006-0517A 11/06
Managing assets in retirement
Fixed expenses
Wealth transfer
Healthcare
expenses
Variable expenses
Emergency/opportunity funds
©2006 Lincoln National Corporation
www.LFG.com
LFD0603-0385 MG-1422-06 11/06
2006-0517A 11/06
What if the balance is destroyed?
Fixed expenses
Wealth transfer
Healthcare
expenses
Variable expenses
Emergency/opportunity funds
©2006 Lincoln National Corporation
www.LFG.com
LFD0603-0385 MG-1422-06 11/06
2006-0517A 11/06
Agenda
Understanding the facts of long-term care
How would you pay for it?
How MoneyGuard ® Reserve can offer
one simple solution
©2006 Lincoln National Corporation
www.LFG.com
LFD0603-0385 MG-1422-06 11/06
2006-0517A 11/06
Chances are, you’ll need care
Chance of needing long-term
care after age 65
70%
Source: “Americans Fail to Act on Long-Term Care Protection,”
The American Society on Aging, May 2003.
©2006 Lincoln National Corporation
www.LFG.com
LFD0603-0385 MG-1422-06 11/06
2006-0517A 11/06
What does long-term care cost?
National average costs of long-term care
Hour
Basic assisted living
Nursing home
Full-time home care
Source: Congressional Budget Office Testimony, “The Cost
and Financing of Long-Term Care Services before the
Subcommittee on Health Committee on Energy and
Commerce,” U.S. House of Representatives, April 27, 2005.
©2006 Lincoln National Corporation
www.LFG.com
LFD0603-0385 MG-1422-06 11/06
2006-0517A 11/06
$18
Day
Month
Year
$60
$1,800
$21,600
$194
$5,833
$70,000
$432
$12,960
$155,520
Who would pay for it
if you needed long-term care?
What you can’t rely on
Medicare — acute care only
Medicaid — must spend down assets
©2006 Lincoln National Corporation
www.LFG.com
LFD0603-0385 MG-1422-06 11/06
2006-0517A 11/06
How to cover long-term care costs
It’s up to you.
You have three choices:
• Pay
• Self-insure
• Reposition
©2006 Lincoln National Corporation
www.LFG.com
LFD0603-0385 MG-1422-06 11/06
2006-0517A 11/06
Traditional long-term care insurance
Advantages
• Guaranteed benefits
• Most policies cover all levels of care
Disadvantages
•
•
•
•
Premiums you pay may be expensive
Recurring premium payments
Premiums may increase
You typically don’t get your money back
©2006 Lincoln National Corporation
www.LFG.com
LFD0603-0385 MG-1422-06 11/06
2006-0517A 11/06
Self-insuring
Advantages
• You maintain control
• You don’t pay for coverage you may never use
Disadvantages
• You must set aside significant liquid assets
• You may deplete assets too quickly
©2006 Lincoln National Corporation
www.LFG.com
LFD0603-0385 MG-1422-06 11/06
2006-0517A 11/06
How to cover long-term care costs
If you’re not
doing anything,
you’re self-insuring.
©2006 Lincoln National Corporation
www.LFG.com
LFD0603-0385 MG-1422-06 11/06
2006-0517A 11/06
Now you can reposition with
MoneyGuard ® Reserve
MoneyGuard ® Reserve, a universal life
insurance policy, is a smart way to cover
long-term care costs. It makes sense —
for today and tomorrow.
©2006 Lincoln National Corporation
www.LFG.com
LFD0603-0385 MG-1422-06 11/06
2006-0517A 11/06
One simple solution
Cash reserves
Designated
for long-term
care costs
Investments
MoneyGuard ®
Reserve
Life insurance
House
While the actual proportions in this chart will differ based on a specific
investor’s needs, it does show the different types of assets in a typical
retirement-oriented portfolio.
©2006 Lincoln National Corporation
www.LFG.com
LFD0603-0385 MG-1422-06 11/06
2006-0517A 11/06
If you need long-term care
Cash reserves
Up to
500% with
MoneyGuard ®
®
MoneyGuard
Reserve
Reserve
Investments
Life insurance
House
Long-term care reimbursements are income tax-free under
IRC Section 104(a)(3).
©2006 Lincoln National Corporation
www.LFG.com
LFD0603-0385 MG-1422-06 11/06
2006-0517A 11/06
If you need it back
Cash reserves
Up to
500% with
MoneyGuard ®
®
MoneyGuard
Reserve
Reserve
premium is returned
Investments
Life insurance
House
©2006 Lincoln National Corporation
www.LFG.com
LFD0603-0385 MG-1422-06 11/06
2006-0517A 11/06
Take it back;
it’s in your reserve.
If you never need long-term care
Cash reserves
Investments
MoneyGuard ®
Reserve
death benefit
Life insurance
House
©2006 Lincoln National Corporation
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LFD0603-0385 MG-1422-06 11/06
2006-0517A 11/06
Unused portion goes
to your beneficiary
income tax-free.
Beneficiaries receive an income
tax-free death benefit under
IRC Section 101(a)(1).
Long-term care coverage
1
You need the full benefits
of MoneyGuard ® Reserve
3 possibilities
1
You need the
full benefits of
MoneyGuard®
2
You change
Reimbursement for long-term care
up to $499,218 income tax-free
©2006 Lincoln National Corporation
www.LFG.com
LFD0603-0385 MG-1422-06 11/06
2006-0517A 11/06
This example is based on a 65-year-old, nonsmoking female in good
health with a $100,000 single premium for a policy with the two-year
Convalescent Care Benefits Rider (CCBR), the four-year Extension of
Benefits Rider (EOBR), and the Return of Premium Rider (ROPR).
Benefit amounts vary by age, gender (except in Montana, where male
premiums apply), and health status. Benefits are adjusted for loans and
withdrawals and may have tax implications. Long-term care
reimbursements are income tax-free under IRC Section 104(a)(3).
your mind
3
You die
Money back guarantee
2
You change your mind
3 possibilities
1
You need the
full benefits of
MoneyGuard®
2
You change
your mind
©2006 Lincoln National Corporation
www.LFG.com
LFD0603-0385 MG-1422-06 11/06
2006-0517A 11/06
This example is based on a 65-year-old, nonsmoking female in good
health with a $100,000 single premium for a policy with the two-year
Convalescent Care Benefits Rider (CCBR), the four-year Extension
of Benefits Rider (EOBR), and the Return of Premium Rider
(ROPR). Benefit amounts vary by age, gender (except in Montana,
where male premiums apply), and health status. Benefits are
adjusted for loans and withdrawals. A portion of the amount returned
may have tax implications.
3
You die
Income tax-free death benefit
3
You never need
long-term care
3 possibilities
1
You need the
All three outcomes
are guaranteed
full benefits of
MoneyGuard®®
2
You change
your mind
©2006 Lincoln National Corporation
www.LFG.com
LFD0603-0385 MG-1422-06 11/06
2006-0517A 11/06
This example is based on a 65-year-old, nonsmoking female in good
health with a $100,000 single premium for a policy with the two-year
Convalescent Care Benefits Rider (CCBR), the four-year Extension
of Benefits Rider (EOBR), and the Return of Premium Rider
(ROPR). Benefit amounts vary by age, gender (except in Montana,
where male premiums apply), and health status. Beneficiaries
receive death benefits income tax-free under IRC Section 101(a)(1).
Guarantees are backed by the claims-paying ability of The
Lincoln National Life Insurance Company.
3
You never need
long-term care
Let’s look at Nancy Arneau
Good health, nonsmoker
Decided against
traditional long-term
care insurance
Currently self-insuring
Wants to protect
her retirement income
Hypothetical example only. Benefit amounts vary by age, gender (except in Montana,
where male premiums apply), and health status.
©2006 Lincoln National Corporation
www.LFG.com
LFD0603-0385 MG-1422-06 11/06
2006-0517A 11/06
Nancy Arneau
Age 65
Repositioning assets
$200,000
Freed up
for retirement
Additional long-term
care benefit
$300,000
Set aside for
long-term care costs
$332,812
Up to
$499,218
$166,406
$100,000
Repositioned for
MoneyGuard payment
©2006 Lincoln National Corporation
www.LFG.com
LFD0603-0385 MG-1422-06 11/06
2006-0517A 11/06
Death benefit or
long-term care benefit
Benefits are adjusted for loans and withdrawals and may have tax
implications. Long-term care reimbursements are income tax-free under
IRC Section 104(a)(3). Beneficiaries receive death benefits income tax-free
under IRC Section 101(a)(1).
Hypothetical example only. Benefit amounts vary by age, gender
(except in Montana, where male premiums apply), and health status.
Three outcomes—all guaranteed
1
2
3
You need the full benefits
You change
You never need
of MoneyGuard® Reserve
your mind
long-term care
©2006 Lincoln National Corporation
www.LFG.com
LFD0603-0385 MG-1422-06 11/06
2006-0517A 11/06
This example is based on a 65-year-old, nonsmoking female in good health with a $100,000 single premium
for a policy with the two-year Convalescent Care Benefits Rider (CCBR), the four-year Extension of Benefits
Rider (EOBR), and the Return of Premium Rider (ROPR). Benefit amounts vary by age, gender (except in
Montana, where male premiums apply), and health status. Benefits are adjusted for loans and withdrawals
and may have tax implications. Long-term care reimbursements are income tax-free under IRC Section
104(a)(3). Beneficiaries receive death benefits income tax-free under IRC Section 101(a)(1).
What you should know about
MoneyGuard ® Reserve
Covers qualified long-term care costs.
Includes a money back guarantee.
Helps you leave money to loved ones.
Helps you maintain control of assets.
Protects assets now and in the future.
©2006 Lincoln National Corporation
www.LFG.com
LFD0603-0385 MG-1422-06 11/06
2006-0517A 11/06
Which option fits your
strategy?
Government programs
Traditional long-term
care insurance
Self-insuring
MoneyGuard ® Reserve
©2006 Lincoln National Corporation
www.LFG.com
LFD0603-0385 MG-1422-06 11/06
2006-0517A 11/06
The challenge of long-term care
Do you have enough assets set aside
for long-term care?
Do you have access to assets?
If you don’t need long-term care,
what happens to the assets?
©2006 Lincoln National Corporation
www.LFG.com
LFD0603-0385 MG-1422-06 11/06
2006-0517A 11/06
Retirement income security
MoneyGuard ® Reserve helps you leverage
dollars available for long-term care costs.
MoneyGuard Reserve offers a
money back guarantee.
MoneyGuard Reserve offers efficient
transfer to your heirs.
©2006 Lincoln National Corporation
www.LFG.com
LFD0603-0385 MG-1422-06 11/06
2006-0517A 11/06
Next steps
Talk with your financial advisor or
insurance agent.
Be sure you’re protecting
your retirement income.
©2006 Lincoln National Corporation
www.LFG.com
LFD0603-0385 MG-1422-06 11/06
2006-0517A 11/06
Important disclosures
MoneyGuard® Reserve is a universal life insurance policy with a rider that accelerates the specified
amount of death benefit to pay for covered long-term care expenses. An Extension of Benefits Rider
(EOBR) is available to continue long-term care benefit payments after the entire specified amount of
death benefit has been paid. The Return of Premium Rider (ROPR) is included at issue (single
premium only). The cost for these riders will be deducted from the policy account value. Guarantees
are backed by the claims-paying ability of the issuer and are subject to policy terms and
conditions. This policy has exclusions and/or limitations. Two-year suicide and contestability
provisions apply (one-year in some states).
This material was prepared to support the promotion and marketing of a universal life
insurance product. Lincoln Financial Group® affiliates, their distributors, and their respective
employees, representatives, and/or insurance agents do not provide tax, accounting, or legal
advice. Any tax statements contained herein were not intended or written to be used, and
cannot be used, for the purpose of avoiding U.S. federal, state, or local tax penalties. Please
consult your own independent advisor as to any tax, accounting, or legal statements
made herein.
MoneyGuard Reserve is issued on policy form LN850 (8/05), Return of Premium Rider on form
LR850 (8/05), Convalescent Care Benefits Rider on form LR851 (8/05), and Extension of Benefits
Rider on form LR852 (8/05) and state variations by The Lincoln National Life Insurance Company,
Fort Wayne, IN. Products and features are subject to state availability. Not for use in MA or NY.
Lincoln Financial Group is the marketing name for Lincoln National Corporation and its affiliates.
©2006 Lincoln National Corporation
www.LFG.com
LFD0603-0385 MG-1422-06 11/06
2006-0517A 11/06