Long-Term Health Care: 3 Things You Should Know
At some point, you’re going to need help doing basic daily activities you may take for granted. Even if it seems like a distant reality, the day you’ll need long term health care will eventually arrive, and you better start planning for it now.
Here are 4 things you need to know.
1. It is inevitable. Seven out of ten people older than 65 will need custodial care in doing their day-to-day tasks, according to recent statistics. Long-term care becomes necessary when a person needs help with at least two basic tasks such as eating or taking a bath.
2. It can be expensive. A lot of people take for granted the need to plan their long term care expenses, believing that this will be taken care of by the government. This, however, is not always true. Living in a semi-private nursing home may cost you around $73,000 each year, according to 2012 data. For private nursing homes, it may go up to around $81,000. These prices will most likely increase in the near future.
3. Preparing for it is best thing you can do for yourself before you retire. Through a long-term health care insurance policy, you can start preparing for the kind of long-term care you will need, depending on your needs and lifestyle. Aside from getting your other retirement benefits in order, an insurance plan that includes assisted care after retirement means less worries in the future. Think of it as an investment for your own peace of mind, as well as your loved ones’.
4. There is no better time to start than NOW. The sooner you start, the more you can maximize a long-term care insurance policy. The premiums you pay will depend on a few factors:
- How old you are
- Your current health status
- How long you think you’ll need coverage
- How much you want to protect yourself from inflation.
With inflation protection, the value of your benefits can even increase over time. With a 5-percent inflation protection in place, for example, the value of your insurance benefits will increase by 5 percent as well.
While your family may be there to also support your needs, it is important to think about how you’ll live the rest of your years after without breaking the bank or financially burdening loved ones. Think about how old you think you’ll be when you need assisted care, or what financial safety nets you have in place in case of disability.
Talk to us, and find out what long-term health care insurance benefits will best suit your plans and needs.
The 2018 Ontario budget features a number of new measures and billions of dollars of enhanced spending across the spectrum, as announced by the province’s Finance Minister, Charles Sousa. Read on for some of the key proposals.
A new sliding scale for personal income tax will be introduced, with seven personal income tax rates which will be applied directly to taxable income, in an attempt to eliminate Ontario’s surtax. The province estimates that approximately 680,000 will pay less tax as a result.
Access to further education will be income linked, with those families with an income of less than $90,000 per year receiving free tuition and families with an income of between $90,000 and $175,00 per year receiving financial aid for tuition costs.
Free Pre-School Child Care
Effective in the Fall of 2020, children aged two-and-a-half until they are eligible for kindergarten can receive free licensed child care.
New Ontario Drug and Dental Program
For those without workplace benefits or not covered by OHIP+, this program offers up to 4.1 million Ontarians a benefit that pays up to 80% of expense up to a cap of $400 for a single person, up to $600 for a couple and $50 per child in a family with two children, regardless of their income.
Free Prescription Drugs
The budget announces the introduction of free prescription drugs for those aged 65 or older, resulting in an average of $240 per year in savings per senior.
Charitable Donation Tax Credit
The non-refundable Ontario Charitable Donation Tax Credit will be tweaked to increase the top rate, remaining at 5.05% for the first $200 but increasing to 17.5% for anything above $200.
Seniors’ Healthy Home Program
$750 is offered to eligible households with seniors of 75 years of age or older to help them to care for and maintain their residence.
R&D Tax Credit
The budget introduces a non-refundable tax credit of 3.5% on eligible costs relating to R&D, or an enhanced rate of 5.5% for eligible expenditures of $1 million plus. Note that this enhanced rate would not be payable to corporations where eligible R&D expenditures in the current tax year are less than 90% of eligible R&D expenditures in the tax year before.
Innovation Tax Credit
The existing Ontario Innovation Tax Credit will see changes to its credit rate in the following way:
· If a company has a ratio of R&D expenditures to gross revenues of 10% or less, they will continue to receive the 8% credit.
· If their ratio is between 10% and 20%, they will receive an enhanced credit rate of between 8-12%, calculated on a straight line basis.
· If their ratio is 20% or more, they will receive an enhanced credit rate of 12%.
Ontario Interactive Digital Media Tax Credit
Eligibility to receive this tax credit will be broadened to include film and television websites.
Several key changes relating to personal financial arrangements are covered in the Canadian government’s 2018 federal budget, which could affect the finances of you and your family. Below are some of the most significant changes to be aware of:
The government is creating a new five-week “use-it-or-lose-it” incentive for new fathers to take parental leave. This would increase the EI parental leave to 40 weeks (maximum) when the second parent agrees to take at least 5 weeks off. Effective June 2019, couples who opt for extended parental leave of 18 months, the second parent can take up to 8 additional weeks, at 33% of their income.
The government aims to reduce the gender wage gap by 2.7% for public servants and 2.6% in the federal private sector. The aim is to ensure that men and women receive the same pay for equal work. They have also announced increased funding for female entrepreneurs.
Effective for 2021 tax filings, the government will require reporting for certain trusts to provide information to provide information on identities of all trustees, beneficiaries, settlors of the trust and each person that has the ability to exert control over the trust.
Registered Disability Savings Plan holders
The budget proposes to extend to 2023 the current temporary measure whereby a family member such as a spouse or parent can hold an RDSP plan on behalf of an adult with reduced capacity.
If you would like more information, please don’t hesitate to contact us.
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Narendra is Canadian Chartered Investment Manager, Certified Financial Planner, Retirement Planning Specialist & Licenced Insurance adviser, he is also qualified Indian Chartered Accountant & Cost & Management Accountant with more than 25 years of progressive experience and strong knowledge in Insurance, retirement planning, financial planning, risk management, cash flow management, investment and portfolio management, accounting, bookkeeping, personal & small business taxes.