Magellan Financial, Inc.
Asset & Wealth Management in Allentown, Pa
Wealth Management
Our wealth advisory team can help optimize your financial life
Comprehensive Insurance Solutions to Safeguard Your Wealth
The right life insurance strategy can play a key role in both helping protect your hard-earned wealth and achieving your financial goals. In addition to helping replace lost income or preserve your estate and legacy, life insurance can also be useful in providing education funding for future generations in the long term. Here at Magellan Financial, we offer various life insurance services for every stage of your life and help you answer any questions.
What is Life Insurance?
A life insurance policy is a contract between the policy’s owner and an insurance company. When you buy a policy, you name the person to be insured (who may be you or someone else) and you select the amount of insurance you desire. You also name a beneficiary. When the person who is insured dies — if your policy is in effect — the life insurance company will pay the in-force amount of insurance (less any outstanding loans and withdrawals) to the person or persons you named as the beneficiaries. This amount is called the “death benefit.”
Is Life Insurance Right for You?
Policies are designed for people who:
- Want to replace the income that is lost due to death
- Seek liquidity to cover expenses, debts, and taxes at death
- Want assets to fund retirement, education, and other family goals in the case of a premature death
- Value tax-efficient income potential to supplement retirement, education, convalescent care, or other financial needs
Types of Life Insurance Policies
Generally, life insurance is offered in two different forms: “term insurance” and “permanent insurance” which may generate what is commonly known as “cash value” (and so is called “cash value insurance”). Although both types of insurance provide a death benefit upon the death of the insured, each type is used to help meet different insurance and financial needs. At Magellan Financial, we can help you decide which policy fits your needs best.
Types of Payment Policies
Term insurance, for example, is for a specific period of time, has no cash value, and is “insurance only.” Relatively inexpensive compared to other options, we often recommend term insurance for younger clients to help cover large, predictable expenses such as college tuition or a mortgage in the event of premature death. These policies typically also include additional monies to cover lost income.
Limited payment policy premiums are only required for a specified period of years, such as 10, 20, or 30 years, or until the insured reaches a specified age, such as 65, beyond which premium payments will not be required. These policies usually have a guaranteed death benefit. One of the more common forms of a limited payment life policy is the single-premium policy. It is offered both as a “fixed” policy (that is, the cash value is held in the general account of the insurance company) and as a “variable” insurance policy (that is, the cash value is held in a separate account that is segregated from the general assets of the insurance company).
Second-to-die policies are a type of insurance policy that provides life insurance coverage for two individuals. All of the types of policies discussed above can be purchased as a form of a second-to-die policy. Note that the death benefit amount is paid only after the death of the second individual (that is, the individual who is the second to die) as designated by the policy, and premium payments may be required after the first insured’s death.
Long-Term Care: Navigating Insurance Options
Unfortunately, all retirees face the possibility of a debilitating illness or injury that requires long-term care. This risk is a source of worry for retirees – many fear they won’t have enough money for long-term care or nursing homes – yet most opt against long-term care insurance due to the high costs. Some think their good health will continue into their golden years or think a spouse or children will be able to tend to them if needed. However, there are multiple strategies to fund your long-term care.
Retirees need to understand the medley of long-term care insurances that are in the marketplace. At Magellan Financial, we work with our clients to make sure they know the fine print so that they make the best decisions for themselves and their loved ones. We suggest that retirees consider seven factors when weighing long-term care insurance options:
- Company reputation & legitimacy
- Coverage parameters
- Benefits payout
- Waiting period
- Eligibility
- Benefits Protection
- Tax Implications
Magellan Financial understands how to structure investments, income streams, and savings so that wealth can potentially grow over time and help sustain long-term care needs. Additionally, an insurance policy can be tailored to support certain expenses. Our team can help you weigh the premiums, risks, and coverages, and ultimately guide you toward the best choice for you. Regardless of what your long-term care strategy entails, the team at Magellan Financial will help you execute it seamlessly.
Long-term care insurance is a tough decision but it doesn’t have to be avoided. Do your research and decide what type of care you are most likely to need. Start with a reputable resource such as acl.gov/ltc and if you want long-term care integrated into your larger retirement planning process, contact us at Magellan Financial today. We can discuss an investment plan that potentially bundles long-term care insurance with a hybrid life insurance policy to control costs.
*Insurance products are offered through nonbank insurance agency affiliates of Wells Fargo & Company and are underwritten by unaffiliated insurance companies.
Contact Magellan Financial
Whether you’re planning for retirement or already there, Contact our team of Financial Professionals about how insurance fits into your plans.