Category Archives: Elderly

Consider Veterans’ Benefits in Financial Planning

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Advisors: Don’t Ignore Veterans Benefits

This is the title of an article which was printed in Financial Planning magazine.  It is a good reminder to both financial services professionals and all those who have served (or are serving) in the U.S. military, to think about how VA benefits fit into individual financial analysis and planning.

Things change.  Benefits change.  Military service that was provided years ago may result in a new or unexpected benefit.  Personally, I have observed how  a widow of a service member benefited through the availability of assisted living through a VA program.  There are lots of rules for each benefit provided, no big surprise there.  But the surprise is that often family members such as spouses, children, and grandchildren  aren’t aware of any of the possible options available because they didn’t serve in the military and don’t have an understanding of the VA, or they just assume that since the military member wasn’t retired or disabled, there are no benefits available. 

Financial Advisors who ask about VA benefits as a routine part of the analysis process can encourage the client to learn more from the VA.  Yes, it can be a daunting process with all the paperwork and questions, but it can also be a very rewarding one if the benefit meets the need.  Adult children can be very helpful in navigating a system which may seem overwhelming to someone who is ill or elderly.

A little research and information are all that are needed to consider VA benefits in the financial planning process. 

Until next time.

Debra Hadsall

www.financialfreedomparty.com

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Women Should Plan to Live to 100-Really??

100BirthdayCake_250I read any and all writings about women and money that come my way.  This one makes us think!  Just click here to learn more about the possibility of living to age 100 and how to plan for it.

Enjoy!

Debra Hadsall

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To order my book Financial Freedom Party for Women, A Little Book about Money for Women, Workbook Edition, please click here.

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My Monkey Mind-Irrevocable Life Insurance Trusts (ILIT)

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My monkey mind postings relate to Buddha’s description of the human mind as being filled with drunken monkeys, jumping around, screeching, chattering, and carrying on endlessly. These postings come from my monkey mind.

Something which happened about 10 years ago has been in my monkey mind.  I guess listening to my friends talk about elderly parents must have triggered it.  So here goes….

As part of my financial services business I had a listing in the Yellow Pages under resources for women.  It was the best I could do since there wasn’t a separate listing for women and finances.  The result was unexpected.  I received random calls from women in difficult life situations ranging from physical abuse, unwanted divorce, requests for money to start  businesses, and sometimes just a reality check on some financial decisions a spouse or significant other had made without checking with the woman.  After these calls continued , I became a connection between these women I never met to non-profits, social services providers, free legal advice, and government agencies who could help.  I learned a bunch of things which reached beyond financial advising.

One day I received one of those calls from an elderly woman who asked me what the difference was between term insurance (no cash value) and universal life insurance (which has a cash value).  The real reason for the call had to do with the fact that her late husband had established an Irrevocable Life Insurance Trust (ILIT) with a cash value policy and she thought he had made a bad decision.  I was curious to hear all the details so I went to visit with her.

In my Financial Freedom Party for Women®, A Little Book about Money for Women, Workbook Edition, I cover the differences between term and cash value policies.  To put it in a couple of sentences, term insurance is a very cost-effective way of getting life insurance and is appropriate for most people.  The premium goes towards the insurance cost and the policy runs for a certain period of time, such as 10, 15, or 20 years.  A policy with a cash value, such as universal life or variable universal life is more complicated and more expensive.  Some of the premium goes to the cost of insurance and some goes into investments offered through the insurance product.  The policy is considered to be “permanent” life since it is not restricted to a certain length of time.  My experience is that these policies (UL and VUL) are often considered upon guidance from an estate planning attorney when creating ways to provide for beneficiaries and reduce estate taxes.  This is a very generalized overview and to learn more please ask your insurance agent or do your own research on-line.

The control of the ILIT rests with a trustee, not the beneficiary (in this case the lady who called me).  This is done because of the estate tax benefits.  You can learn more by clicking here.  As with most people, she did not like knowing she had “all this money”, yet couldn’t access it when she wished.  I came to learn that was part of the plan.

I shared this insight with the lady. Apparently I was the first person she met who sat down and explained to her how this ILIT all worked. I was also the only woman advisor/insurance agent she had ever met.  She found me through my Yellow Page listing.

I learned that she was unhappy because the ILIT controlled her spending.  She had to ask a young man( who was the trustee) for any money which was needed  in addition to the monthly payment which had been established.  The goal of the plan was to keep her from running out of money.   I learned that her ILIT  did contain a universal life policy, the trust was created by an attorney with involvement by the now-deceased husband, and seemed to be in good order and in her best interest.  The things the trustee had told her were true, if she did not control her spending, she ran the risk of outliving her money.  In this situation, the planning was really in her best interest and when we finished our discussion, she, for the first time, realized it.  We talked about other ways for her to finance the expenses she wanted to incur including having a roommate in her spacious home, moving to a smaller one, or cutting expenses elsewhere.

I never heard from her again, but I learned a lot.  I saw how the appropriate cash value life insurance policy can be an integral and useful part of estate planning and a way to take care of beneficiaries upon the death of the insured.  My passion for working with women to understand their finances was re-kindled.  I knew that if someone had taken time to speak to this lady in language she could understand, her life would have been much better.  Sometimes financial professionals forget that it is not all about the numbers,  it is about how the numbers improve the lives of clients and getting the  clients to understand that.  It also reinforced my belief that the best time to learn about finances is not when your spouse or family member has died and not there to explain things.  Learning the fundamentals as a young person will make things a lot easier throughout her or his lifetime.

This event has stayed with me.  My insurance career involved term life insurance and that worked well for my family and clients. The ILIT was a good example how a cash value policy can be beneficial in estate planning and for beneficiaries who may need some additional structure and measured control over assets.  Each situation is different and this posting is not intended to provide you with personal advice on your estate planning, financial planning, or insurance needs.

Until next time.

Debra Hadsall

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www.financialfreedomparty.com

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Empty Mansions– Living the Good Life?

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I just finished reading the book “Empty Mansions” by Bill Dedman and Paul Clark Newell, Junior.  The title says it is about “The Mysterious Life of Huguette Clark and the Spending of a Great American Fortune”.

Any book with the words fortune and spending just calls to my financial education mind.  It would seem that a book about wealth would be all about what we call “living the good life”.  I learned that the title refers to the empty properties Huguette continued to maintain even though she didn’t live in them.  Interesting.

This book is about a woman and her story which revolves around extreme wealth, business, family owned businesses, decision-making, relationships, trust and distrust, and how money can be both a blessing and a curse.

Personally, it took me a long time to learn to deal with money in an unemotional manner.  The main character, struggled with that for a really long time as she was born in 1906 and died in 2011. She dealt with a lot of emotions and they often guided her decisions.  For Huguette, these decisions usually involved  large sums of money. The world changed radically during her lifetime and she also outlived her close relatives.  Some of the change was more than Huguette wished to deal with, so she created a lifestyle which was strange and unconventional to most ordinary (and even wealthy) people.  Her needs for security and safety as a wealthy person played a big part in how she spent money.  As an elderly woman  it appeared that those who were caring for her may have taken advantage of  her financially, even though the medical professionals found her competent.

It is hard to imagine the majestic homes her father created with his wealth  and the mind-set of  Huguette who was born into such a lifestyle and never knew anything different.  Still, I was struck by the similarity between the decisions she had to make about  businesses, advisors, and income management, and those made by the rest of as we manage our personal finances or make lifestyle and financial decisions about the senior citizens our lives.

Was Huguette happy living what most would see as “the good life”?  It is hard to tell.  That is the mystery which remains in her interesting life story.

Until next time.

Debra J. Hadsall

DiminishedCapactity, What’s That?

Diminished capacity includes a variety of symptoms or conditions.  Often we relate them to aging, but it can be in people of all ages due to physical or mental health conditions.  Whatever the cause, when things change in a person’s life as a result of diminished capacity the lives of those around her or him change also.  Not all issues are simply medical ones, many have to do with how a family member or friend can assist.  To learn more, please just click here

Until next time.

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Debra Hadsall

Financial Freedom Party for Women, A Little Book about Money for Women, Workbook Edition is now available at amazon.com.  Just click here.

Myths about Long Term Care Insurance

When I was working full-time with clients in my financial services business (planning, analysis, insurance, and investments) I made an interesting discovery.  The most emotional and misunderstood products were life insurance and long-term care insurance.  It is just easier for some folks to deny that we may die at most inconvenient time, and that we may grow old and  not be able to care for ourselves.  I have heard all kinds of different viewpoints on the subjects!

I talk about the subject of both types of insurance  in my book, Financial Freedom Party for Women, A Little Book about Money for Women. 

Until you have a chance to order one, please take some time and educate—or re-educate yourself on a few myths and truths about long-term care and long-term care insurance.  Just click here.

Until next time.

 

Debra Hadsall

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www.financialfreedomparty.com

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My Monkey Mind-Cultural Differences

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My monkey mind postings relate to Buddha’s description of the human mind as being filled with drunken monkeys, jumping around, screeching, chattering, and carrying on endlessly. These postings come from my monkey mind.
 
While walking around the town we moved to in the hill country of Texas, I was thinking how different it is culturally from the small gulf coast town where we had been living until recently.  I was recalling  how I had been telling  a young woman there about my mother’s recent move to a nice retirement community.  She had been around my mother and gotten to know her a little.  I could tell that my young friend probably didn’t really know understand the idea of an independent living retirement community, assisted living, or nursing homes.  As with many people in the area we lived, her family roots were in Mexico. 
 
Her reaction reminded me of a presentation I made to a group of people who had recently arrived in Colorado.  One of the not-for-profit agencies offered life skills training to them and I was asked to speak.  Of course nobody told me it was going to be to a group who only understood Spanish.  It was an interesting evening and I learned a lot.
 
Everything had to be translated by their teacher.  She was motivated and capable, so all was well.  It was just a different rhythm than past presentations.  I explained topics such as checking accounts, car insurance, pay slips, insurance, and even investing.  She would then play it back to the group, in Spanish.  She could have said anything, what would I know?  So learning to trust another with my information was the first lesson of the evening.
 
All was going well and the audience seemed to be getting it so I decided to include information about long-term care insurance.  I made my statements and waited for the translation.  When the teacher finished, everyone in the audience started laughing, giggling, and looking at me like I was just a little crazy. There was a big change in the noise level in the room.  The teacher laughed a little too.  I asked her what had made them react that way since the topic never generated that reaction before.  She explained that in their culture nobody goes to retirement or nursing homes, except the nuns.  The elderly are simply a part of the extended family and are cared for by children, grandchildren, and others in the family.  The idea of buying insurance to pay someone to care for them when they were old seemed ridiculous, funny, and clearly a waste of money.  They were entertained, but not impressed.  A first for me.
 
After that evening I would preface my long-term care insurance presentations to acknowledge cultural differences, and then explain the potential value to the customer.  Like I said, I learned a lot that evening. 
 
Until next time.
 
Debra Hadsall
 
 
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 www.financialfreedomparty.com
blog at www.ffptalk.com