Life Insurance is a financial tool that protects against the risk that a person will die too soon and be unable to fulfill obligations to loved ones. A life insurance policy guarantees that a designated amount of money will be available, generally income-tax-free, at the very time it is needed most, at death, when survivors may be exposed to certain financial risks, such as burial expenses, loss of personal or business income and debts.

We can help you to understand its necessity and the importance of this insurance. Discuss with us our particular financial goals and which types of life insurance are available and which ones will best fit your needs.

When you’re healthy, it’s hard to imagine being disabled by illness or injury. That type of thing always happens to someone else, but it can happen. In fact:

• One in 3 working Americans will become disabled for 90 days or more before age 65.

• The average disability absence is 2 and a half years. 

• More than 80% of working Americans don’t have disability income insurance or aren’t covered adequately.

What would you do if your paychecks suddenly stopped because you were too sick to work?  What if this illness or injury prevented you from working for months -- or even years?  You would still have to pay all your monthly bills, food expense, utilities, mortgages, car payments, etc.  It's easy to see how quickly your savings could disappear.

To better understand Long Term Care, think of the activities that you performed when you woke up this morning. You probably: Climbed out of bed , Walked to the bathroom , took a bath or shower, Got dressed, Ate breakfast.

While we are healthy it is easy for us to take for granted the above Activities of Daily Living (ADL's). However, when you or a loved one is stricken with a degenerative condition such as a stroke or Alzheimer's, performing these ADL's becomes impossible without the assistance of another person.

As Americans take care of themselves through a healthy diet and exercise, they are increasing their projected longevity. Unfortunately, as people age, they are more likely to suffer from chronic illnesses such as strokes or Alzheimer's. Statistically, Americans over the age of 65 face a 40% risk of entering a nursing home for Long Term Care services.

What Do Long Term Care Services Cost?

Obviously Long Term Care services are very expensive. Quality nursing homes are always filled to capacity and they are consequently able to command a hefty fee for services.

Home care is also expensive. Bringing a home health aide into your home every other day for a 4 hour visit can easily cost $1800 per month. When the home care approaches 8 hour visits every day, the costs rise to $7200 per month. At this point, the care recipient begins to receive facility based care simply for economic reasons.

There are 4 main ways in which to pay for long term care, cash, Medicare, Medicaid, or private insurance. Before you begin paying for long term care insurance it is critical that you plan early so you make the best decision possible.

You may often hear the term Annuity.  But, what exactly does it mean?  Even if you have an annuity do you know what is the difference between a variable, fixed and other annuities?  Can you use the annuity as income?  We can answer these questions and more to give you a precise explanation of what the best solutions are right for you when planning your future.

Annuities come in various forms – fixed, variable, income, index-linked and more – and each has its place and time in an investment portfolio. Generally, annuities are purchased as long-term investments to cover future needs like retirement or lifetime income; however, in recent times, annuities have emerged as a safe-haven for “just-in-case” money that heretofore was held in banks or government bonds. Annuities are issued by insurance companies and generally presented by financial advisors and planners to conservative, long-term savers seeking reasonable returns, safety and some access to their money in case of unexpected needs. All annuities offer triple compounding through tax deferral of earnings.

What is health insurance and why do I need it?  If you've ever been sick or injured, you've probably recognized the importance of Health insurance. Health insurance helps to ensure that you and your family are protected against the financial hardships that may result from health care expenses.

There are many different types of health insurance available. How do you which option is best for you.  Let us help you plan the right coverage for your needs.

Voluntary Employees Beneficiary Associations (VEBAs) and their cousins, taxable welfare arrangements, are gaining in popularity. In an era of high taxes and high employee benefit costs, the ability to provide this benefit to families and employees with pre-tax dollars is unique. Here's why.

The 419A(f)(6) plan should only be considered when there is a need for life insurance on a tax-deductible basis. When structured as multiple employer plans (consistent with the Internal Revenue Code 419A(f)(6) exception for 10 or more employer plans), these plans can provide long-term death benefit protection with current tax deductions. When properly structured, participants may avoid income and estate taxes on the death benefit and minimize or eliminate gift tax exposure. This makes these plans perfect for business and estate-planning use.

A 412(i) defined benefit pension plan, referred to in IRS regulations as an insurance contract plan, is the only defined benefit plan that is exempt from the minimum funding requirements of Section 412 of the internal revenue code. This type of plan, therefore, enjoys certain advantages over the traditional defined benefit plan and is worth exploring if you are the owner of a small business.

These advantages create a plan that, compared to a traditional defined benefit plan, will produce:
Larger initial deductions , More stability in the contribution level, Simpler plan administration, and A secure promise of future benefits guaranteed by an insurance company.

What are the advantages of a 412(i) insurance contract plan over a traditional defined benefit plan?

A 412(i) insurance contract plan:

• Does not require an enrolled actuary.

• Is not subject to the full funding limitation tests of a defined benefit plan.

• Is required to use the contract guarantees as funding assumptions, thus shielding them from IRS attack as unreasonable funding assumptions.

• Can be designed to eliminate the potential of excess plan assets that, in a traditional plan, would be subject to taxes and penalties of 80% or more upon termination of the plan.

• Produces an understandable accrued benefit since it is simply the cash value of the contracts funding the participants account.

• Creates larger initial deductions than a traditional plan since the funding assumptions are required to be much more conservative.

• Provides retirement benefits that are guaranteed by the insurance company and not just the financial strength of the particular employer providing the plan.

What happens to your hard-earned savings when you need long-term care? How are you going to protect your house, your doll collection, and your heirlooms when you or your spouse has to move into a costly nursing home? People of modest means find out, sometimes painfully, that they are required to foot the bill for long-term healthcare. Medicare only pays a very limited amount of nursing home expenses. And Medicaid is difficult to qualify for since you have to already have spent away your hard-earned savings.

Most people assume that either they will not have to enter a nursing facility, or that once they do, "The Government" (i.e., Medicare or Medicaid) will pick up the tab. The first assumption is a form of denial, and the second assumption is only true in the worst scenarios. The fact is, as people age, they have a greater and greater probability of requiring some form of skilled care. Fortunately, more and more skilled care can be provided in the home, but nursing homes are still a reality for millions of elderly, especially those with dementia. The Government helps to pay for short-term care through Medicare, but only pays for people with very limited finances through Medicaid.

In some states, nursing home costs can exceed $8,000 per month. That means that if you are paying for it yourself, it can run to almost $100,000 per year out of your own savings. If you have even modest assets of about $4,000 in the bank, you will NOT be able to receive Medicaid. There are some exceptions, but the vast majority of people are not eligible for Medicaid due to existing assets (such as bank accounts and property) and monthly income (such as pensions and Social Security benefits).

"Estate planning" includes techniques and considerations that individuals and families use to make sure that their assets are disposed of in the way they desire near and at the time of their death. Proper estate planning uses legal methods to assess the value of one's estate, acquire insurance (such as life insurance and long-term care insurance), prepare the appropriate legal documents (such as wills, healthcare proxies and powers of attorney), provide gifts to family members and charities, and minimize taxes. The proper coordination and execution of all of these matters should be conducted with the guidance of a qualified (and specialized) elder law attorney and other financial and care management professionals.

Nearly everyone needs a financial plan, but not everyone needs a financial planner. How do you know whether you should hire an expert or do it yourself?

If you have no interest in learning about starting an investment program, selecting individual stocks or mutual funds, or deciding on your asset allocation; if you don't want to take the time away from work, family, and other commitments; or if you're having trouble meeting your financial goals, then a financial planner may be for you. Many people design their own financial road maps but confer with an advisor periodically about specific issues or life stages, such as leaving the workforce to retire.

Garfinkle-Lerner will assess where you are financially and design a plan to help you meet your financial goals. We will look at your overall "big financial picture" taking into consideration accounting, investing, tax, and insurance issues.  Put our experience to work for you.

The benefits you offer to your employees should be as attractive as your business can afford. They can help you recruit new employees and retain those who are crucial to your company's success. As a business owner today, you have a comprehensive array of basic, elective, and fringe benefits to consider:

• Basics, such as vacation, paid holidays, sick leave, and a health insurance plan, are often needed to be competitive in today's benefits market. In large companies, most employees also expect a qualified retirement plan to be available.
   

• Consider including long-term and short-term disability coverage, group life insurance, dental and vision care, stock options, and contributing to or matching your employees' contributions to the company's retirement plan.
   

• Other benefits you can offer include fringe benefits, such as the use of a company car, flextime, telecommuting, parking passes, public transportation passes, club memberships, or tickets to sporting events. 

The cost of providing these benefits to your employees is often tax deductible to your business. You also may be able to exclude the value of the benefits from your employee's gross income. This reduces your taxable payroll, resulting in a decrease in your Social Security, Medicare, and state and federal unemployment tax obligations.

Call for details