Working Toward a Tax-Free Retirement with Long Term Care Insurance

   I have spoken at length about how pre-taxed funds can complicate an estate plan. While having a fund that you can grow with pre-taxed money can increase the rate of the fund’s growth, it can be a bit of a double-edged sword.

           The thing with pre-taxed money (like traditional IRAs) is that if you want to use that money, you have to pay the tax on it first. You can’t roll those funds over to cover the cost of living, nor can you pull the money out to pay for big expenses without also paying tax. Thus, that money is essentially locked up.

           What I am getting at is, an estate heavily invested in pre-taxed accounts tends to not be very flexible for planning purposes. And you want flexibility. After all, 70% of individuals over the age of 65 will need some type of long-term care. If most of your money is locked up, how will you manage to protect your assets and pay for long-term care?

           A great option for folks with pre-taxed accounts is an asset based long-term care insurance policy. As I’ve mentioned in other articles, long-term care insurance is a great tool to cover the cost of future care (not only long-term care but chronic care as well). Not only does it cover the cost of long-term care, it also provides you with flexibility in your future plans, all the while costing less in a year than two-weeks at a long-term care facility.

           So, what’s an asset based long-term care policy? This type of policy allows for you to directly pay your long-term care insurance premiums out of your tax qualified account. This is a great option because it allows you to roll that money over without taking an immediate tax hit. Thus, the amount withdrawn from the pre-taxed account is not taxed when used to pay the long-term care premiums. Furthermore, what you pay toward long-term care insurance may be tax deductible depending on your overall medical expenses for the year.

           Long-term care insurance is not only a great option to ensure that your cost of care is covered at a reasonable and affordable rate, it’s also a great estate planning tool to lend you flexibility and optimize your tax liability each year. If you have questions regarding long-term care insurance or an Estate Planning or Elder Law matter, let the experienced attorney at McIntyre Elder Law help you. Call (704) 259-7040 for a consultation today.

Book Your Appointment Today!


Brenton S. Begley

Elder Law Attorney

McIntyre Elder Law

“We help seniors maintain their lifestyle and preserve their legacies.”

Phone: 704-259-7040

Fax: 866-908-1278

PO Box 165

Shelby, NC 28151-0165

Schedule Free Consult

Blog Categories
Get the Latest Updates
Greg McIntyre, JD, MBA

Meet Greg McIntyre

Greg McIntyre, founder of McIntyre Elder Law, is more than just an attorney. As a Navy Veteran, father to six kids, and a loving husband, he values family deeply. This drives his commitment to helping clients safeguard their futures and pass down legacies.

Greg has a passion to help people. Beyond just legal advice, he loves having conversations and strives to build a long-term relationship with every clients that comes through his door.

Connect with Greg

Act now to secure your legacy and protect your loved ones.

At McIntyre Elder Law, we’re dedicated to assisting North Carolina families, seniors, and their loved ones as they plan for the future.

Whether you need to prepare for future long-term care, access Medicaid or nursing home benefits, or need help settling a loved one’s estate, we’re here to support you.

Contact us for a complimentary consultation to take the first steps towards safeguarding your lifestyle, your legacy, and your family’s wellbeing.

Before you go!

The Elder Law Handbook

Your comprehensive guide to safeguarding your financial well-being and ensuring your legacy stands the test of time. Download the FREE handbook today.

By providing your phone number, you agree to receive text messages from McIntyre Elder Law. Message and data rates may apply. Message frequency varies.

Skip to content