In addition to typical medical expenses in retirement, you should also consider the cost of long-term care arrangements should you need professional care in your later years, either in-home or in an assisted living facility. There's a good chance you'll need assistance, and it won't be cheap. Recent studies have put the odds at 50/50 that a 65 year old will need living assistance in their lifetime. The average period of help runs about 2 years. 

According to the 2012 MetLife Market Survey of Nursing Home, Assisted Living, Adult Day Services, and Home Care Costs, the average annual cost for a private room at a nursing home in 2012 was $90,520. The national average for a semi-private room was $81,030. The national average for an individual living in an assisted living community was $42,600.

In most cases, long-term care health insurance coverage provides benefits for nursing homes, assisted living facilities, and home care. If you can afford the premiums, you may want to consider purchasing long-term care insurance. 

Many of our clients find that the cost of these policies and the potential for the premiums to increase in the future are prohibitive to them purchasing the insurance. We have found a creative solution that combines long-term care insurance with whole-life life insurance. In this situation, a client would purchase a whole-life policy (for example, $250,000). They then add a long-term care rider onto the policy (cost depending on several factors). The policy works like a normal life insurance policy unless you need long-term care. When you do need help, the policy pays out 1% of the death benefit monthly towards long-term care. In our example, the policy would pay out $2,500 a month as long as the client needed the help up until the death benefit it used up. If the client only uses $50,000 of death benefit on long-term care costs and then subsequently passes away, their beneficiary would receive the remaining $200,000 of death benefit. 

We cannot stress enough the importance of planning for retirement costs, long-term care being one of them. We also understand the hesitancy of clients to purchase long-term care costs due to the cost. We have found this whole-life/long-term care duo to be a creative solution to the problem. 

Please contact us to review your personal situation and see if this might be a good solution to your planning issues. 

There has been a push to teach financial literacy in high school, but it seems like t hat push is falling on deaf ears. One thing is certain, kids are not learning valuable money skills at school, so it is up to parents to teach these lessons.

B el ow is a list of some of the important things kids need to know about money. 

If you want more help on ideas and ways to teach kids about money, Joline Godfrey has authored a great book called, Raising Financially Fit Kids. See the link above for how to get your own copy.
Conversations with your kids about money, the small, grand and grown kind, can be tricky. Your Ailsa Capital advisor is always happy to talk through your questions.  We enjoy educating others in financial topics, let us know if we can be of help.