Have you read your Social Security statement lately?

By Brett Anderson

St. Croix Advisors

We have heard from some of our younger clients that Social Security is one of the worst investments they will ever put their money into because they believe they’ll never see a dime of it. No matter where you stand on Social Security, here’s one item we can all agree on: by 2016, the Social Security Administration will be paying more money out than they collect.

We believe it is a safe bet that if you’re not close to retiring, you are never going to get the money you put into Social Security. Here’s one of the most common misperceptions that people have about Medicare:

If you look at page 4 of your Social Security Statement, under the about Social Security and Medicare section, you’ll see the following statement: “Medicare does not pay for long term care, so you may want to consider options for private insurance.”

Most people believe that Social Security will pay for their care, when in reality, it won’t. Michael Astrue, Commissioner of Social Security, has clearly stated that Social Security will not pay for long term care expenses and people need to purchase insurance.

Not only will the government not pay for long term care, Congress, the Senate and our president believe in giving tax deductions for business owners who purchase long term care insurance for themselves, family members and employees. This is great news for business owners.

The majority of people have been saving for their retirement for most of their working career. In fact, most people don’t even factor in long term care when planning for their retirement years. When we ask people about their long-term retirement goals, most of them, nearly 100 percent, do not factor long term care expenses into their financial plan. That’s right — almost zero are planning for care we might need down the road.

The current plan is that 100 percent of retirement savings is going to lifestyle, not for long term care expenses. Doesn’t it make strategic sense to develop a financial plan around helping to protect your retirement savings?

You can look at all the statistics you want, the bottom line is, we are all getting older and chances are we’re all going to need some form of long term care as we age. The good news is, with the proper planning, you can establish a long term care insurance plan to help pay for a good portion of your care in your retirement years. Not only that, you can probably pay for a long term care insurance contract by the time you reach 60 or 65 years old if you plan.

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