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Understanding Life Insurance and the Special Needs Trust: Part 2
Understanding Life Insurance and the Special Needs Trust: Part 2

While it can be difficult to have to think about caring for your family after you pass, doing so when you are responsible for a loved one with disabilities is even more difficult. In order to alleviate some of your concerns, we have put together this two-part series about Special Needs Trusts.

 

In the first post of this two-part series, we defined the basics of what a Special Needs Trust is and it’s benefits. In this second part, we will discuss how you can set one of these trusts up using your life insurance policy.

 

Funding your Special Needs Trust

As we mentioned in the last post, this type of trust is designed to help support your loved one living with disabilities without affecting their government benefits like Social Security, Medicaid, or Medicare. To do this you will need to put money in the trust, but where does it come from?

 

There are a number of ways you can use your savings, investments, or even your will to fund your trust. One of the best and surest ways to fund your trust is with your life insurance plan. Some of the many benefits of using your policy include:

 

You can get an excellent value for your money because your monthly premium can help secure a significant death benefit.

You may avoid excess income and estate taxes if your family structures your trust correctly. You have much more control over how your estate is split among your surviving family members.

 

By using your life insurance to set up a Special Needs Trust, you are providing your loved ones with the resources to lead a full life even after you pass.

Bankers Fidelity is a leader in providing affordable term life insurance in Texas, Iowa, Indiana, and 43 other states (plus DC). If you have questions, contact our agents for life insurance in the state that best applies to your location.

 

Sources:

  1. BestLifeRates.Org

  2. American Bar Association

 

This article is for informative purposes only and not intended to provide legal or tax advice. You should consult with an attorney or tax accountant for professional education.

 

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Understanding Life Insurance and the Special Needs Trust: Part 1
Understanding Life Insurance and the Special Needs Trust: Part 1

f you take care of a loved one who is living with a disability, you understand the amount of time and care that goes into ensuring their day-to-day welfare. You work hard to make sure that their every need is seen to so they can lead a full life. Unfortunately, you might not always be around to support them.

 

Planning how best to protect your family should the worst happen is difficult, it can be especially trying for those with loved ones who struggle with disabilities. Any insecurities and indecision are doubled by the concern for your loved one's long term well-being.

 

Fortunately, you are not without recourse. If you are one of the 60% of people with life insurance, or one of the additional 34% of people planning to purchase it this coming year, you can use your life insurance plan to establish a Special Needs Trust. This trust may help your loved even after you have passed.

 

In this two-part series, we will take a closer look into what Special Needs Trusts are and what they can do for your family, as well as how you can use your life insurance coverage to fund them.

 

What Is a Special Needs Trust?

A Special Needs Trust is a trust that is designed for those living with disabilities; either physical or intellectual. It is designed so that the beneficiary can continue receiving their needs-based government benefits such as Medicare, Medicaid, and Social Security after you have passed. There is an option in this trust to set up a special trustee if an individual is legally incapable of managing the trust themselves.


What Are the Benefits of a Special Needs Trust?

Special Needs Trusts are complex legal documents that, when completed correctly, can accomplish a variety of goals. Working with an attorney may help your trust accomplish the following:

 

  • It allows you to leave both property and other resources to be used for the benefit of your loved one with a disability in a way that preserves their public assistance.

  • It prevents other family members from being overburdened by the demands of caring for a relative with disabilities.

  • It allows you more control over how the estate is distributed.

  • It can help to sustain your loved one with disabilities over a longer period of time through careful budgeting and better management.

Stay tuned for the second installment of this series! In it, we will discuss how you can use your life insurance policy to fund your Special Needs Trust and how you can use a special needs trustee to better manage the funds after you pass.

 

Sources:

  1. BestLifeRates.Org

  2. American Bar Association

 

This article is for informative purposes only and not intended to provide legal or tax advice. You should consult with an attorney or tax accountant for professional education.

 

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Life Insurance: Getting Back to Basics with These 4 Important Facts

life insurance arizona

Life insurance is an important safety net that may provide for your loved ones when you are gone. Despite its importance, there are still a number of misconceptions and misunderstandings about how it works and what it covers.

While the rules for life insurance vary state to state (life insurance offerings in Arizona may not be available in Idaho, for instance), many of the most important tenets remain true.

This post is designed to help you understand four important things to remember when considering life insurance plans.

  1. If you are financially responsible for another person, you may want life insurance: Whether it is a spouse, child, dependent parents, or employees of your business, you should consider life insurance so that the people in your life don't suffer if something were to happen to you.

  2. Life insurance isn't a ‘Get Rich Scheme’: Daytime television might be full of stories of murder for life insurance benefits but the reality is that, in many cases, life insurance will cover little more than the cost of funeral services and outstanding debts. While it is true that benefit increments can range from $10,000 into the millions, whatever is left over will likely be necessary to help lessen the burden after losing a steady income.

  3. There are different types of life insurance: One form is called Term Life Insurance. This is the popular type and can be less expensive in premium. It essentially only lasts through the term -- or amount of time -- it is in place, usually 10, 20, or 30 years.

    Another form is Whole Life Insurance, which is designed to last the lifetime of the insured. With this option there is a cash value involved in order to sustain the policy.

  4. Life Insurance is Probably Cheaper Than You Think: Unless you are applying for the top benefits, life insurance can be less expensive than most people believe. For someone in their 30s who leads a healthy lifestyle and doesn't smoke, policies may be available for less than $500 a year.

Life insurance is an important tool to protect your loved ones. This may give you a better idea of some of the core information about life insurance policies so you can start a conversation with an independent agent today.

Sources:

 

  1. Knowledge Center

  2. Forbes

 

Life Insurance policies are underwritten by Bankers Fidelity Life Insurance Company®, Atlanta, GA. Limitations and exclusions apply; actual policy provisions control. Application to determine eligibility required. Rates subject to change. Product availability and benefits can vary by state.


Signs You Might Need Medicare Supplement Insurance
Signs You Might Need Medicare Supplement Insurance

Medicare is an amazing program, covering preventative costs, emergency visits, short-term care needs and more. According to the Kaiser Family Foundation in 2013, 6 in 10 Americans believe the program is working well, with 8 in 10 seniors giving it a positive review.

Despite its popularity, however, Medicare does not offer exhaustive coverage. Gaps exist in areas like traveling abroad and prescription drug coverage.

In order to rectify these short-fallings in essential health benefits, several Medicare Supplement insurance plans, or Medigap insurance, exist to help.

Below are reasons you may want to consider Medigap insurance:

If You Have Cancer
Cancer is a very difficult disease. It is especially difficult on the finances of the family. With Original Medicare, most of your inpatient and certain outpatient procedures may be covered; however, you may still experience a hefty co-payment on many necessary procedures.

Medigap insurance can help alleviate some of that burden, covering some of your co-pays and allowing you more options for the sort of medical attention you want.

If You Plan To Travel Abroad
For many seniors, retirement is the reward for a life of working and contributing to society. The so-called golden years are your chance to focus on your loved ones, see the world, pursue a passion, or generally relax. That said, if you do plan on seeing the world, it is important to know that your Medicare will not cover many medical expenses abroad.

The six standard plans that offer coverage for emergency care while traveling abroad are: Plans C, D, F, G, M, and N. These plans will ensure that you are covered in the case of an extreme emergency, but you still must plan ahead for your prescriptions.

Medicare Supplement options can go a long way to ease the burden of certain medical conditions and broaden your coverage but they are by no means the end all be all in managing health care expenses. Talk to your insurance agent to see what programs might be best for you. 

https://www.medicare.gov/Pubs/pdf/11034.pdf

Disclaimer: Neither Bankers Fidelity Life Insurance Company® nor its Medicare Supplement policies are affiliated with or endorsed by the U.S. Government, the federal Medicare program, or the Centers for Medicare and Medicaid Services. This is a solicitation of Medicare Supplement insurance and an independent agent may call on you. 

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Air Pollution Still a Problem for Older Adults: 5 Steps to Mitigate the Risk
Air Pollution Still a Problem for Older Adults: 5 Steps to Mitigate the Risk

A new study published in the New England Journal of Medicine concluded that air pollution kills thousands of Americans every year. The study used data from millions of Americans on Medicare to determine the consequences of air pollution on older Americans.

The study was among the most comprehensive to date on the effects of air pollution. Led by Francesca Dominici, a Harvard T.H. Chan School of Public Health biostatistics professor, the study required researchers to synthesize data from federal air monitoring stations and satellites to create a map of air pollution. The map was so detailed that it could determine pollution for individual zip codes.

The pollution map was then cross referenced with data from 60 million Americans on Medicare from 2000-2013. The conclusion drawn was that even low levels of air pollution are lethal, killing around 12,000 Americans per year.

"We are now providing bullet-proof evidence that we are breathing harmful air," Dominici said in an interview with NPR. "Our air is contaminated."

But what can Americans do with this information? There are several concrete steps you can take to protect yourself.

1. Check Your Daily Pollution Forecast
The American Lung Association has an app that you can download that will let you know how much pollution to expect in your area on any given day. If the forecast is high, limit the amount of time you spend outdoors.

2. Avoid Exercising in Areas of Heavy Traffic
Cars create pollution. Even if you are going for a short walk down the road, the pollution has the ability to build up over time. State parks and gyms are a great alternative for a safer place to exercise.

3. Get Regular Check Ups
Air pollution can cause a number of diseases, including lung cancer. That is why it is important that you take full advantage of the preventative care options that your insurance offers. That way, you can catch any diseases early.

4. Stop Smoking
This one should be self-explanatory, but if you are worried about air pollution then you need to make a concerted effort to cut down on the amount of cigarette smoke you are exposed to. While smoking habits have decreased, 8.4% of the population still smoked in 2014, according to the State of Aging and Health in America.

5. Consider Medicare Supplement Insurance Options (Medigap)
If you live in an area of high pollution, you may decide to invest in a Medigap plan that can offer you more protection should the worst happen.

Air pollution is a serious problem for all Americans, but for seniors, it can have a more pronounced effect. Taking precautions can prevent you from experiencing the worst of the consequences. 

http://www.nejm.org/doi/10.1056/NEJMoa1702747

Disclaimer: Neither Bankers Fidelity Life Insurance Company® nor its Medicare Supplement policies are affiliated with or endorsed by the U.S. Government, the federal Medicare program, or the Centers for Medicare and Medicaid Services. This is a solicitation of Medicare Supplement insurance and an independent agent may call on you. 

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