Personal Retirement Funds

[PC800]

Presumaly, you will be in a higher tax bracket then you are now,

Smellthejeta, there are a couple of flaws in your analysis:

1. Most people have a lower income after they retire than they did when they working-- which means they're in a lower tax bracket after retirement, not a higher one. That's supposed to be one of the advantages of a regular IRA or 401k-- rather than pay taxes on your contributions at your present higher rate, you pay taxes on it after retirement, when you're in a lower bracket.

2. If you're in, say, the 28% tax bracket, that does not mean that your entire income is taxed at 28%. For a joint return, in rough numbers, the first $15,000 is taxed at 10%, the next $45,000 at 15%, the next $60,000 at 25%; only amounts over $120,000 (and less than $182,000) would be taxed at 28%. The net effect of this is that the percentage of your gross income that goes to federal taxes is substantially less than your tax bracket. A retirement income of $100,000 would place the taxpayer in the 25% tax bracket-- but their federal tax would be around $15,000, or 15% of their gross income.

3. Tax brackets only go to 35%, not 50%-- and you'd have to have a annual retirement income of over $325,000 to reach that bracket. If you're going to make your living in the aviation industry, it ain't likely you're going to be retiring on $300k+ per year. <g>

 

[Dangerkitty]

Uh, no, it's not.

I have a very comprehensive Blue Cross/Blue Shield medical policy, and it provides very limited coverage skilled nursing care coverage-- and only for those enrollees that have Medicare Part A. Their benefits brochure specifically states, "Note: If you do not have Medicare Part A, we do not provide benefits for skilled nursing facility care."

OTOH, skilled nursing care coverage is a benefit of my John Hancock LTC policy. This is quite common in LTC policies, and often required by state law. For instance, for LTC policies sold in the State of New York, "The home care benefit must cover skilled nursing care, home health care, personal care and assisted living care."

You are so confused about this that you are falling into a trap that many seniors do. I used to work for BCBS in Texas and dealt with this all the time when I sold Medicare Supplements. What you just quoted is why seniors think that they have Long Term Care Coverage when they dont.

Let's break it down to the basics:

Skilled Nursing Care is care given to someone when the Condition WILL get better. Rehabbing of a knee replacement for example. LTC DOES NOT COVER THIS!!!

Un-skilled nursing care is care given to someone when the condition will never get better. Someone has Alzheimer's is always going to have Alzheimers and the condition will never improve. This is what LTC insurance covers. When someone has a condition where they are going to need care 24/7/365 LTC is what pays for it.

 

[Dangerkitty]

And by the way in the quote you made above you are actually proving my point but since you dont know what you are talking about in the first place you probably do not realize that.

Medicare has NOTHING and I mean NOTHING to do with unskilled Long Term care facilities, home health care or anything similar to that. When they state skilled nursing facilities they are referring to REHAB!

 

[PC800]

What have I stated that is wrong in regards to LTC and what are your insurance credentials?

You have stated that LTC insurance does NOT cover skilled nursing care, and that medical insurance does. In fact, the opposite is true.

I have no insurance "credentials"; I'm just a savvy consumer.


Your lack of expertise in financial matters is readily apparent, not only from your apparent misunderstanding of tax brackets, but from the following quote from your last post:

"Debt is debt. I could care less (to a certain extent) what the interest rate it."

If you hope to someday achieve your financial goals, you need to start caring about what the interest rate is. I don't like debt either, and have none, except for a small mortgage at 4.875%. I have the money to pay off that mortgage, but I don't-- because paying off low interest debt with money that is earning at a higher rate is financially stupid.

And before you ask, no, I don't have any financial planning credentials. However, I did manage to reach my financial goals and retire, very comfortably, 9 years ago-- at the age of 45.

 

[Dangerkitty]

You have stated that LTC insurance does NOT cover skilled nursing care, and that medical insurance does. In fact, the opposite is true.

I have no insurance "credentials"; I'm just a savvy consumer.


Your lack of expertise in financial matters is readily apparent, not only from your apparent misunderstanding of tax brackets, but from the following quote from your last post:

"Debt is debt. I could care less (to a certain extent) what the interest rate it."

If you hope to someday achieve your financial goals, you need to start caring about what the interest rate is. I don't like debt either, and have none, except for a small mortgage at 4.875%. I have the money to pay off that mortgage, but I don't-- because paying off low interest debt with money that is earning at a higher rate is financially stupid.

And before you ask, no, I don't have any financial planning credentials. However, I did manage to reach my financial goals and retire, very comfortably, 9 years ago-- at the age of 45.

PC800,

Again you are just plain stupid. You are like the little old man I use to have to try to explain the way Medicare and LTC Insurance worked. He heard from a friend who heard from a friend and thought he knew how it worked. Well 9 times out of 10 he was clueless.

For some reason you seem to think you know what a skilled nursing facility is when you couldn't be further from the truth.

Why dont you do a search and educate yourself because all you do here is state I am wrong but yet you can't back up your points.

Once again Skilled Nursing Care is rehab, which is covered under Medicare and or Medical Insurance. LTC only covers unskilled nursing facilities.
Why you can't get that through your thick head is beyond me.

 

[smellthejeta]

I don't like debt either, and have none, except for a small mortgage at 4.875%. I have the money to pay off that mortgage, but I don't-- because paying off low interest debt with money that is earning at a higher rate is financially stupid.

May I ask where you have your money such that it is earning more than your mortgage rate? I current have some dough stashed aside in an account paying 4.0% APY and am looking to do better.

 

[PC800]

Skilled Nursing Care is care given to someone when the Condition WILL get better. Rehabbing of a knee replacement for example. LTC DOES NOT COVER THIS!!!

Your'e right that the rehabbing of the knee replacement wouldn't be covered, but for the wrong reasons. It's a bad example, here's a better one: I fall off my motorcycle and end up in the hospital. They get me patched up, and my medical policy pays. But, I can't feed myself, dress myself, bathe myself, etc., and I'm going to need IV's, catheters, and other services that can only be provided by skilled personnel. They ship me off to the rehab center.

After the appropriate waiting period (mine is 30 days), my LTC policy *will* kick in to cover the skilled nursing care I'll be receiving until I'm well enough to perform the basic functions myself. Here's a direct quote from the plain language explanation of benefits provided with my John Hancock LTC policy:

"Skilled nursing care, which is ordered by a doctor and provided by qualified personnel such as registered nurses or professional therapists. Such care is designed to treat a medical condition from which you're expected to recover."

Note, this is not on the exclusions page, it's on the benefits page.

Now, maybe the policies you sell don't cover such things, I don't know. But mine, and many others, do.

 

[Dangerkitty]

Then you must live in the State of New York. They have the craziest insurance laws so much so that many Insurance Companies such as AFLAC, GE, John Hancock and Allstate all have totally seperate departments that only work within that State. At AFLAC the New York division is treated as a totally different company.

I have never seen nor read where a John Hancock LTC policy pays for Skilled Nursing care. And I sell for John Hancock.

The only explanation that I can give is that you must live in New York. Either that or you are an internet troll trying to yank my chain.

Wouldn't be the first time.

 

[PC800]

May I ask where you have your money such that it is earning more than your mortgage rate?

I'm afraid my method probably won't work for you at present interest rates: my IRA's (I have both Roth and traditional) are invested in a series of "laddered" Certificates of Deposit-- and several of the CD's in the traditional IRA were purchased eight, nine, and ten years ago, when rates were higher (the highest I have right now is paying 7.35%). When they mature, it may make sense to pay off the mortgage rather than roll them over, depending on what interest rates do.

The most recent CD's are only paying 4 to 5%-- but they're in a Roth, so the earnings are tax-free-- which means that's a better deal than paying off my mortgage, which (after taxes) is costing less than 4%.

 

[PC800]

The only explanation that I can give is that you must live in New York. Either that or you are an internet troll trying to yank my chain.

Neither one. The policy I have is the same one offered to federal employees and retirees in all 50 states.

If you do a Google search for "skilled nursing care"+"long term care insurance", you get a lot of sites that mention "skilled nursing care" as something LTC covers, so I find it hard to believe it's that unusual.

If policies sold in your state don't include skilled nursing care, maybe it's your state that's out of sync with everybody else!

 

[Dangerkitty]

Neither one. The policy I have is the same one offered to federal employees and retirees in all 50 states.

If you do a Google search for "skilled nursing care"+"long term care insurance", you get a lot of sites that mention "skilled nursing care" as something LTC covers, so I find it hard to believe it's that unusual.

If policies sold in your state don't include skilled nursing care, maybe it's your state that's out of sync with everybody else!

Then the only other conclusion that I can come to is that we are arguing semantics. Skilled care vs unskilled care.

 

[psysicx]

With IRA's and 401K's its very easy to retire a millionaire if you start early.

 

[JohnDoe]

Back to the attempt at some usefull info here.......

Any more recommendations on roth ira companies? I was about to start a vanguard and noticed they now have a $3000 minimum to start.

And no, I don't care about skilled or unskilled home care.....

 

[PC800]

Then the only other conclusion that I can come to is that we are arguing semantics. Skilled care vs unskilled care.

According to my benefits brochure, skilled care is, "A higher level of daily nursing and rehabilitative care (such as injections, catheterizations, and dressing changes) provided by trained medical professionals, including nurses, doctors, and physical therapists."


An LTC policy should cover both skilled and unskilled care. Supporting that contention (and leading me to believe such policies are widely available) is this, from an online "How To Choose An LTC Policy" page (emphasis mine):

"Long term care is covered completely or in part by long term care insurance. Most plans let you choose the amount of the coverage you want, as well as how and where you want to use your benefits. A comprehensive plan includes benefits for all levels of care, custodial to skilled."

 

[kingairyahoo]

Back to the attempt at some usefull info here.......

Any more recommendations on roth ira companies? I was about to start a vanguard and noticed they now have a $3000 minimum to start.

And no, I don't care about skilled or unskilled home care.....

...post number 45 on page 3 gives some options