What Are My Financial Options?
By M. Bryan Freeman
Anyone diagnosed with a serious illness, such as ALS, knows that dealing with actual health issues is just one part of a new puzzle. More likely than not, financial concerns usually accompany serious illness. Even those who have prepared well sometimes encounter financial challenges.
The good news is that there are financial options. But there is also a lot to know about financial planning, benefits, insurance and taxes, and that knowledge becomes all the more powerful for you in the face of ALS.
It is important to learn about financial options as soon as possible after diagnosis because knowledge is empowering and allows you to take advantage of much-needed options. If you do not understand the benefits you have or to which you may be entitled, you may lose them as some of your options must be exercised within a finite window of time, or they are gone forever.
For instance, it is imperative to understand your employee (work-related) benefits before leaving your job. If you have group health, long term disability insurance, long term care benefits and or group life insurance at work, you may be able to take them with you when you leave or gain substantial benefits by making the right decisions at the right time.
Begin educating yourself early about your options to avoid surprises and maximize the possibilities for you and your loved ones. Your early financial decisions can have a devastating impact or a positive affect on your quality of life.
One example of a little known benefit is the ability to turn your life insurance into cash for use now. Many policies offer an option to get an advance on the death benefit, often called a “living benefit,” if you qualify on the basis of a diagnosis; however, qualification guidelines can be strict. Another option is called a “viatical settlement,” whereby you sell your life insurance for a portion of the face value of the policy and no longer pay premiums.
You may use both of these options together if you qualify for both and if you need the increased amount of money exercising both options would garner. Typically, you would exercise the insurer’s “living benefit” option first, and then use a life insurance settlement to monetize the remainder portion of the policy. In each case, and under certain conditions, the proceeds of these transactions may be tax free.
Many people have individual policies, but most have a group life policy through a job. Before you transition out of a job, find out how to take the policy with you. One way is to go out on disability, but you have a limited time to enact that conversion.
In addition to monetizing your life insurance, you should also investigate your options regarding other work-related benefits, such as medical and disability insurance, as well as entitlements, credit management, savings, investment and inheritance.
M. Bryan Freeman, Founder and President of Habersham Funding, LLC, is recognized for his longstanding efforts in providing insurance and financial solutions for people with serious illness. Last year he helped spearhead The ALS Association, Georgia Chapter’s Educational Symposium. In May, he will speak to the The ALS Association Advocacy Day & Public Policy Conference in Washington, D.C. He has partnered with numerous non-profits—locally, statewide and nationally—to present programs on the best use of existing assets, and employer and government benefits. www.YouCanSellYourLifeInsurance.com