This week, we’re talking about long-term care and why it’s important to make some decisions today about how you’re going to pay for long-term care in retirement.

Yesterday, I told you about my client Lucy who was rapidly draining her retirement nest egg to pay for her late husband’s alzheimer's care. Today I want to dive a little deeper into long-term care insurance, because for the vast majority of Americans in the financial middle, some long-term care insurance makes sense.

Why? Well, being in the middle class or upper middle class is where paying for long-term care can do the most damage. The poor will be covered by medicaid and the rich have plenty of assets to pay for long-term care. But if a $200,000 lifetime spend on long-term care over your lifetime is going to wipe out your nest egg, then you’ll want to look seriously at long-term care insurance.

So let's take a look at insurance today, starting with: what does long-term care insurance cost? I ran the numbers for a 57 year old, single female in Oregon and the estimated monthly premium amount is $151 per month, which would provide a long-term care monthly benefit of $2500/month.

If you can afford the cost of insurance, it can provide for a significant long-term care benefit if you need to use the policy later in life.

Insurance policies have also evolved over the years, so if you don’t end up using your long-term care insurance you can tack on a life insurance benefit so at least you won’t have to “use it or lose it”.

That’s it for today. Thanks for listening.

Tomorrow we’re going to talk more about when you should buy long-term care insurance.

My name is Ashley Micciche and this is the One Minute Retirement Tip.

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Tags: retirement, investing, money, finance, financial planning, retirement planning, saving money, personal finance, wealth management, long term care, long term care insurance, long term care definition, long term care cost, what is long term care facility, long term care options, long term care insurance, long term care insurance cost, alternatives to long term care insurance, long term care insurance quotes, long term care insurance definition, pros and cons of long term care insurance, probability of needing long term care, long term care insurance companies, when to buy long term care insurance

This week, we’re talking about long-term care and why it’s important to make some decisions today about how you’re going to pay for long-term care in retirement.

Yesterday we talked about the harsh reality of the long-term care landscape - there’s a decent chance (about 50/50) that you’ll need long-term care in your lifetime, and it can be very expensive to pay for - potentially wiping out your retirement nest egg.

Today we’re talking about how you can protect yourself financially if you need long-term care.

I have a client, we’ll call her Lucy, who’s husband battled Alzheimer's for 9 years. The first 7 of those 9 years, she cared for him in their home, but the last 2 years, she could no longer care for him on her own and he moved to a memory care facility.

The care Lucy was providing for those 7 years was an incredible burden, but when he moved to memory care, it began to take a serious financial toll on Lucy. And I became genuinely concerned she was going to run out of money.

Their investment portfolio was not large enough to support the large withdrawals she was taking out to pay for his care. And they didn’t have long-term care insurance. As long as they still had assets, Medicaid wasn’t going to kick in. So Lucy was left with draining their savings to pay for her husband’s care.  All the while worrying if there would be anything left for her.

Thankfully in the end, she did not run out of money after paying for her late husband’s long-term care. But the cost of long-term care did some damage to her nest egg, and it caused enormous financial stress and worry for Lucy that she would be left with nothing.

This story illustrates how important it is for those of you in the middle to take a serious look at long-term care insurance. The poor will be covered by medicaid and the rich have plenty of assets to pay for long-term care. But if your retirement will be wiped out if you need to spend upwards of $200,000 on long-term care over your lifetime, then you’ll want to look seriously at long-term care insurance.

That’s it for today. Thanks for listening!

My name is Ashley Micciche and this is the One Minute Retirement Tip.

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Tags: retirement, investing, money, finance, financial planning, retirement planning, saving money, personal finance, wealth management, long term care, long term care insurance, long term care definition, long term care cost, what is long term care facility, long term care options, long term care insurance, long term care insurance cost, alternatives to long term care insurance, long term care insurance quotes, long term care insurance definition, pros and cons of long term care insurance, probability of needing long term care, long term care insurance companies, when to buy long term care insurance, long term care medicaid

This week, we’re talking about long-term care and why it’s important to make some decisions today about how you’re going to pay for long-term care in retirement.

Today we’re covering the statistics about long-term care to help you understand the harsh and expensive reality of paying for long-term care.

First of all, let’s talk about the likelihood that you’ll need long-term care in the first place. According to a 2017 study by AARP, if you’re 65 or older, there is a 52% chance that you will need some type of long-term care in your lifetime. 52%. Toss a coin and it could go either way. So the odds are pretty high.

If you’re a woman, the odds are even higher - it’s a 58% chance that you’ll need long-term care.

On average, a man will need long-term care for 1 ½ years while a woman will need long-term care for 2 ½ years. One of the downsides of living longer for us women is that we will usually require long-term care more often and for longer periods of time.

Now let’s talk about the financial cost of long-term care.

The median annual cost for long-term care ranges from $18,000 for adult day care to $97,000 for a private room in a nursing home.

If you require long-term care for an extended period or if you develop dementia or Altzheimer’s, the costs skyrocket. The estimated lifetime cost of care for someone with dementia is $341,840.

And 15% of us will spend more than $250,000 on long-term care in our lifetime.

Those costs can wipe out your wealth, which is why it’s so important to understand your options and protect yourself.

That’s it for today! Thanks for listening.

My name is Ashley Micciche and this is the One Minute Retirement Tip.

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Tags: retirement, investing, money, finance, financial planning, retirement planning, saving money, personal finance, wealth management, long term care, long term care insurance, long term care definition, long term care cost, what is long term care facility, long term care options, long term care insurance, long term care insurance cost, alternatives to long term care insurance, long term care insurance quotes, long term care insurance definition, pros and cons of long term care insurance, probability of needing long term care, long term care insurance companies, when to buy long term care insurance

This week, we’re talking about long-term care and why it’s important to make some decisions today about how you’re going to pay for long-term care in retirement.

Today we’re starting at the beginning to clarify what long-term care actually is. When many people think of long-term care, they think of nursing homes. But long-term care is a very wide spectrum of care that you or your loved ones might need when you can no longer perform everyday activities on your own.

Long-term care is defined by needing help with everyday activities, also called "activities of daily living." This includes bathing, dressing, grooming, using the toilet, eating, and moving around—for example, getting out of bed and into a chair.

When defined in this way, it’s easy to see why so many of us will need long-term care as we age.

Today, most long-term care is provided at home by unpaid family members and friends. In the case of dementia or Alzheimer's, long-term care could mean living at a memory care facility.

So it’s a wide spectrum of care. And chances are very good that you will need long-term care as you age. Tomorrow we’ll talk more about those statistics, but for today, I want you to think about how you would handle your own long-term care needs in retirement.

Even if you don’t need round-the-clock memory care, do you have family members who are willing to help out or willing to let you move in with them if you can no longer live on your own? Many children who provide long-term care to a parent reduce their hours or stop working entirely to help out an aging parent. They often end up contributing financially as well on top of the lost wages from not working. Are they going to be ok with that and are you going to be okay with that?

Would you be comfortable living in a retirement community or a nursing home or is it critically important that you stay in your own home?

First understanding how and where you want to live if you require long-term care is an important first step because it influences decisions you’ll make about paying for long-term care.

That’s it for today, Thanks for listening!

Tomorrow, come on back, because I’m going to cover the eye-opening statistics about long-term care.

My name is Ashley Micciche and this is the One Minute Retirement Tip.

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Tags: retirement, investing, money, finance, financial planning, retirement planning, saving money, personal finance, wealth management, long term care, long term care insurance, long term care definition, long term care cost, what is long term care facility, long term care options, long term care insurance, long term care insurance cost, alternatives to long term care insurance, long term care insurance quotes, long term care insurance definition, pros and cons of long term care insurance, probability of needing long term care, long term care insurance companies

It’s a brand new weekly theme here on the One Minute Retirement Tip, and this week we’re talking about long-term care. What it is, why you’ll want to give it some serious thought as you transition into retirement, and how you can protect yourself if you ever need to pay for long-term care.

My hope is that you’ll come away from this week’s tips better informed about long-term care, and be able to answer a very important question: Should you buy long-term care insurance to protect yourself in retirement? It’s an important question to answer, especially if you’re in your 50s.

Because if you’re going to buy long-term care insurance, that’s the time to do it. If you wait until you’re older or if you’re not in good health when you buy long-term care insurance, the premiums skyrocket.

Before we go any further this week, I want you to know that while I used to be licensed to sell long-term care insurance and I know a lot about it, I don’t actually have a dog in this fight. I gave up my license and ability to sell long-term care insurance when we started our firm, True North.  

Hopefully that will help you trust that what I’m going to share with you this week is my honest opinion that doesn’t come with a sales pitch attached.

That’s it for today. Thanks for listening!

Before you go, please leave a review for the One Minute Retirement Tip in Amazon. Your review is so important – potentially thousands of people will read your review and decide to enable (or not) based on your feedback.

My name is Ashley Micciche...and this is the One Minute Retirement Tip.

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Tags: retirement, investing, money, finance, financial planning, retirement planning, saving money, personal finance, wealth management, long term care, long term care insurance, long term care definition, long term care cost, what is long term care facility, long term care options, long term care insurance, long term care insurance cost, alternatives to long term care insurance, long term care insurance quotes, long term care insurance definition, pros and cons of long term care insurance, probability of needing long term care, long term care insurance companies

It’s Sunday, which means...It’s recap time!

The theme for this week was: Myth Busting! There are a lot of myths floating around out there about investing, so the focus this week was busting some of the more pervasive myths that could hinder your chances of a successful retirement.

I hope after listening to this week’s tips, you’ll be better equipped to think rationally and make smart decisions about how you invest your money.

In case you missed any of this week’s episodes, here are the myths I tried to bust in 2 minutes or less:

• You must be a savvy investor to be successful
• Stock market investing is exactly the same as gambling
• Cheaper is always better when it comes to picking investments
• Real estate is a better investment than stocks
• Gold is a safe investment

If you missed any of these episodes, you can find them on iTunes or Google Play by searching for the “One Minute Retirement Tip with Ashley”.

Tomorrow, come on back, because we’re starting a brand new theme: Long-term Care. I’ll help you better understand long-term care insurance, whether or not it’s a good fit for you, and the importance of considering long-term care as you approach retirement. Needing to pay for long-term care can quickly obliterate the best laid plan for retirement, so I’ll help you work out if you should take a closer look at long-term care insurance in next week’s tips.

That’s it for this week! Thanks for listening.

My name is Ashley Micciche and this is the “One Minute Retirement Tip”.

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Tags: retirement, investing, money, finance, financial planning, retirement planning, saving money, personal finance, wealth management, investing myths, savvy investor, how to invest in stocks, how to start investing in stocks, investing 101, investing in stocks 101, how to invest in stocks for beginners, stock market myths

This week, we’re busting myths about investing, so you’ll be better equipped to think rationally and make smarter decisions about how you invest your money.

Today myth I’m busting is: Gold is a safe investment.

Eh! Wrong again.

When there’s volatility in the stock market, the ads for gold come out of the woodwork - “Protect your IRA by transferring it to gold today!” But have you ever noticed that these ads disappear again as soon as the stock market turns around?

Gold has long been a safe haven investment in times of uncertainty and economic downturns. But it’s actually a terrible long-term investment. If you bought gold in the 1970s, you lost money for about 35 years. 35 years. Multiple decades of negative returns before gold investors were finally vindicated in the 2000s, when gold finally had a nice run. Any investment that could possibly lose money for longer than I’ve been alive is not even remotely a safe investment.

In fact, what makes gold a poor investment choice is that it is incredibly volatile!  Extreme volatility without properly rewarding you for that roller coaster ride.

And if that wasn’t enough to bust this myth about gold being a safe investment, consider the words of Warren Buffett, arguably the most successful stock market investor ever. He said: “(Gold) gets dug out of the ground in Africa, or someplace. Then we melt it down, dig another hole, bury it again and pay people to stand around guarding it. It has no utility. Anyone watching from Mars would be scratching their head.”

That’s it for today. Tomorrow, we’re going to recap the week and I’m going to give you a little preview of next week’s theme.

But before you go, please leave a review for the One Minute Retirement Tip in Amazon! Reviews help Alexa users decipher between the gold and the garbage, so if these tips are helping you on your path to retirement, please share the love with others by leaving a review!

My name is Ashley Micciche and this is the One Minute Retirement Tip.

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Tags: retirement, investing, money, finance, financial planning, retirement planning, saving money, personal finance, wealth management, investing myths, savvy investor, how to invest in stocks, how to start investing in stocks, investing 101, investing in stocks 101, how to invest in stocks for beginners, stock market myths, stock market crash, gold, gold investing, is gold a good investment, is buying gold a safe investment

This week, we’re busting myths about investing, so you’ll be better equipped to think rationally and make smarter decisions about how you invest your money.

Today myth is: Real estate is a better investment than stocks.

Buzzer! Wrong.

If you lean toward real estate as the better investment, consider the risk, lack of diversification, headaches, and lack of liquidity that real estate offers you.

Most people don’t have the assets to invest in more than a handful of properties. That’s a lack of diversification. Most people also only consider homes and not other types of real estate, like commercial properties. That’s a further lack of diversification if you’re just investing in one type of real estate.

Investing in real estate has a lot of headaches because you have to keep it up, paint it, change the lightbulbs, pay for a new roof - and if you’re not willing to do that, you have to pay someone to do it for you.

And then there’s the lack of liquidity. It can take months or years to sell a property. What do you do if you need money in an emergency.

And then there’s the massive debt that’s often required to invest in real estate.

Real estate isn’t a bad investment, but let’s be realistic about it. I meet a lot of people who have all of their net worth tied up in real estate who are happy to laugh and tell me what a joke the stock market is. But these same people don’t actually factor in the total costs of owning real estate. I often talk to real estate investors who own properties where they are losing $200/month or $500/month, but hey, they’re in a great location and it’s going to turn around real soon.

Stock market returns (as measured by the S&P 500) have averaged 7.2% per year for the last 20 years. That’s with 2 massive declines from the tech bubble burst and the great recession. 7.2% per year even with those big downturns thrown in - pretty impressive. You quadrupled your money as a stock market investor over the last 20 years, all while not changing a single light bulb or having to evict any delinquent tenants.

The average home price in the U.S. increased by an average of 3.4% over that same time period - less than half of the return in the stock market.

That’s it for today. Thanks for listening.

Tomorrow I’m going to tell you what I really think about gold.

My name is Ashley Micciche and this is the One Minute Retirement Tip.

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Tags: retirement, investing, money, finance, financial planning, retirement planning, saving money, personal finance, wealth management, investing myths, savvy investor, how to invest in stocks, how to start investing in stocks, investing 101, investing in stocks 101, how to invest in stocks for beginners, stock market myths, stock market crash, real estate vs stocks, real estate investing

This week, we’re busting myths about investing, so you’ll be better equipped to think rationally and make smarter decisions about how you invest your money.

Today’s myth is: Cheaper is always better.

Buzzer! Wrong!

Of course, fees do matter when it comes to your investment portfolio, but I see investors pursue low cost investing at the expense of a whole slough of other factors that should also be considered when evaluating your portfolio.

So here’s how I want you to think about fees instead. It’s a two-prong approach. 1) There is no free lunch when it comes to investing your money. So it’s important to understand what your fees are. How much are you paying in trading costs or commissions? How much are you paying per year in the underlying investment fees of the mutual funds or ETFs you invest your money in? And if you use a financial advisor, how much are you paying them?

Successful investing isn’t just about picking good investments. It’s about managing your emotions, making sure that you have the right stock and bond mix, that you’re saving enough, rebalancing your portfolio when you should, being tax efficient, and upteen other things, which is why I don’t run out of things to talk about here on the one minute retirement tip.

My point is, that while investing isn’t free and cheaper doesn’t automatically equal better, what you pay should be reasonable. That’s the key word: Reasonable.

So what is reasonable? If you’re a DIY investor, your all-in annual costs shouldn’t exceed .75% annually. If you use professional help from a financial advisor, your fees should not exceed 1.5%. In practice, I’ve found that if clients’ all-in fees were less than 1.5% per year, we didn't have issues with underperformance, plus they were able to take advantage of all of the advice and planning that comes with having a trusted advisor, all while saving themselves a lot of time and effort trying to do everything on their own.

That’s it for today. Thanks for listening! Tomorrow we’re going to put real estate head to head with stocks to see which one is better.

My name is Ashley Micciche and this is the One Minute Retirement Tip.

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Tags: retirement, investing, money, finance, financial planning, retirement planning, saving money, personal finance, investing myths, savvy investor, how to invest in stocks, how to start investing in stocks, investing 101, investing in stocks 101, how to invest in stocks for beginners, stock market myths, stock market crash, wealth management, low cost investments, mutual funds, ETFs, ETF, index funds

This week, we’re busting myths about investing, so you’ll be better equipped to think rationally and make smarter decisions about how you invest your money.

Today’s myth is: Investing in stocks is just like gambling.

Buzzer! Wrong!

This one used to throw me for a loop, because it is so wildly untrue, yet I hear it over and over again. I have a number of 401k plan clients, and as part of that consulting work, I put on education sessions for the employees in the plan. So I’ll give presentations about the same topics we cover in these tips, and inevitably someone raises their hand and says “Now why would I invest in the stock market? It’s no different than going down to the casino!”

I’m not a big gambler. I hate losing money and gambling stresses me out. I actually was in Vegas a couple years ago for like 3 days for a conference and I didn’t gamble once. But I do occasionally gamble and my favorite casino game is Roulette, which is also the dumbest game to play because it has the worst odds. The odds of hitting a single number on a straight-up bet are 37 to 1. But the payout is big if you hit your number: 35 to 1.

Do you know what the odds of losing all your money when you invest in a diversified portfolio of stocks and bonds? From 1950 to 2018 (nearly 70 years), there were definitely individual years where you lost money, but for someone who was invested 50% in the S&P 500 and 50% in the US Aggregate bond index, there wasn’t a single 5-year time period where you lost money!

Pick any 5-years you want from 1950 to today  - every single one was positive. In addition, the average annual return of a 50/50 stocks to bonds portfolio since 1950 has been 8.8%. That means you’ve been doubling your money about every 8 years!

Does that sound like gambling to you?

If you’re tempted to stay out of stocks or bonds because you think it’s just like gambling, consider the alternative: hiding your money under the mattress where the real wealth killer - inflation - will do tremendous damage on your hard-earned cash.

That’s it for today! Thanks for listening.

My name is Ashley Micciche and this is the One Minute Retirement Tip.

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Tags: retirement, investing, money, finance, financial planning, retirement planning, saving money, personal finance, investing myths, savvy investor, how to invest in stocks, how to start investing in stocks, investing 101, investing in stocks 101, how to invest in stocks for beginners, stock market myths, stock market crash, wealth management