How to Fund Long-Term Care Using Other People’s Money

[Northeast Agent]

https://ldloweplan.com/how-to-fund-long-term-care-using-other-peoples-money/

There’s also a way to obtain life insurance using other people’s money to fund your long-term care needs, protect your legacy, and save on taxes. A Premium Financed Equity Indexed Universal Life Policy (PFEIUL) is a large-sum policy that is structured so its premium can be paid by a bank loan. Because the borrowing costs of the bank loan are significantly lower than the returns earned on investments, servicing the loan can provide protection while generating additional cash flow.

For example, a 55-year-old woman could secure a $5 million PFEIUL policy with asset-based, long-term care protection that accelerates a portion of the death benefit when she does not meet two or more of four daily living activities (bathing, feeding, dressing, mobility, etc.). In addition, the policy benefit would be tax deferred, would increase annual income, provide for long-term care expenses and provide the client’s heirs with a death benefit.

Policy premiums would be paid using a bank loan at 3.5% and pay $119,500 per year over a term of five years. Using this method, she would receive a projected supplemental income of $4,935,000 over the life of her plan.

 

[Tahoe Ray]

https://ldloweplan.com/how-to-fund-long-term-care-using-other-peoples-money/

There’s also a way to obtain life insurance using other people’s money to fund your long-term care needs, protect your legacy, and save on taxes. A Premium Financed Equity Indexed Universal Life Policy (PFEIUL) is a large-sum policy that is structured so its premium can be paid by a bank loan. Because the borrowing costs of the bank loan are significantly lower than the returns earned on investments, servicing the loan can provide protection while generating additional cash flow.

For example, a 55-year-old woman could secure a $5 million PFEIUL policy with asset-based, long-term care protection that accelerates a portion of the death benefit when she does not meet two or more of four daily living activities (bathing, feeding, dressing, mobility, etc.). In addition, the policy benefit would be tax deferred, would increase annual income, provide for long-term care expenses and provide the client’s heirs with a death benefit.

Policy premiums would be paid using a bank loan at 3.5% and pay $119,500 per year over a term of five years. Using this method, she would receive a projected supplemental income of $4,935,000 over the life of her plan.

And as an added bonus, if the policy doesn't perform, you get to owe both the LTC facility AND the bank.

 

[Northeast Agent]

Tahoe Ray said:

And as an added bonus, if the policy doesn't perform, you get to owe both the LTC facility AND the bank.

Ouch... And who needs THIS much for LTC, anyway?

 

[Allen Trent]

And as an added bonus, if the policy doesn't perform, you get to owe both the LTC facility AND the bank.

And as an added bonus, as I assume said bank would have required collateral to satisfy the loan, you may have the note called when real estate devalues like happened to many people in 2008 with commercial property. Even though they had never missed a payment.

Maybe I am wrong that a bank would want more collateral than just the new policy. Dont premium finance lenders require collateral such as cash, securities or letters of credit?

 

[ltcadviser]

For example, a 55-year-old woman could secure a $5 million PFEIUL policy with asset-based, long-term care protection.

Policy premiums would be paid using a bank loan at 3.5% and pay $119,500 per year over a term of five years. Using this method, she would receive a projected supplemental income of $4,935,000 over the life of her plan.

“projected”

Not exactly a synonym for “Guaranteed”

 

[kpbdy99]

Tough crowd.