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My Stash-Shielding Insurance

April 10th, 2014 at 10:31 am

(I now blog weekly on frugal living, personal finance & earlier retirement at:
retiredtowin.com)




I wish I did not have to maintain insurance policies or pay the premiums. But I'd rather do that than run the risk of having my retirement stash hit hard by some unforeseen financial catastrophe. So I've made sure to have enough insurance coverage to protect me in case I'm in an auto accident, have a big medical issue, suffer major damage to my home, need to go to a nursing home or get sued over anything.

I am paying $5474 a year in premiums for 8 policies: home, health (a 4-policy cocktail), auto, long term care and personal umbrella liability. That $5474 amounts to 41% of my annual basic living expenses!

Steep? Sure! But better than risking my retirement, don't you know?!

(For the full story of my stash-shielding insurance, feel free to visit my main blog at retiredtowin.com.)

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6 Responses to “My Stash-Shielding Insurance”

  1. Single Guy Says:

    I have to agree with most but not all of your analysis.

    Health - oh yes.

    Home - definitely.

    Long term care - here is where I diverge. I understand the rationale, but depending on your age, the odds are you will be much better off saving the premiums and investing them to use "in case" you need them. Most long term care has various limits that, to me, makes them not worth the expense.

    Auto - of course.

    Personal liability - depends on where you have your stash. It is much harder (though not impossible) to get at your stash if it is mostly in retirement accounts (mine currently is ~80% in a 457 or IRA). As well you have to think if you are in a profession or live a way that makes it more likely to need this. In my case I believe given all that I don't need this type of insurance (though I did carry it for one year). I may get it again - this is one I am still considering.

    And as I have some life insurance through my employer, I don't need any more.

    Not that your analysis is bad, but just throwing out there another viewpoint.

  2. Miz Pat Says:

    I made a call for a quote on long term care. I put it off, because I am scared of the thought, but being without it would be even scarier.

    Thank you - you give good advice. God bless you.

  3. snafu Says:

    We've a different system for health care, [USA is the only modern nation without universal health care].
    I'm jumping back and forth on long term care. Genetically and given my medical history, I doubt I'll make it to 75 y/o. DH 's family is much better. For $200. a month in a Dividend ETF or RIEF ETF I should be able to fund LTC if needed If not needed it would be part of my estate. The policies I've looked at have daily limits and I've no idea of what type of care will be needed or the cost. Right now we're talking about retiring in the Philippines. DH gets these out-of-the-park ideas.

  4. Retired To Win Says:

    Single Guy Says:

    "I have to agree with most but not all of your analysis...

    Long term care - here is where I diverge. I understand the rationale, but depending on your age, the odds are you will be much better off saving the premiums and investing them to use "in case" you need them. Most long term care has various limits that, to me, makes them not worth the expense...

    Personal liability - depends on where you have your stash. It is much harder (though not impossible) to get at your stash if it is mostly in retirement accounts (mine currently is ~80% in a 457 or IRA). As well you have to think if you are in a profession or live a way that makes it more likely to need this. In my case I believe given all that I don't need this type of insurance (though I did carry it for one year). I may get it again - this is one I am still considering...

    Not that your analysis is bad, but just throwing out there another viewpoint."


    Single Guy, thanks for taking the time to make your thoughtful reply.

    On longterm insurance, I am bearing in mind (which was not obvious in my original post) that I could end up needing this NOW, not decades from now, if some terrible crippling accident should befall me. So, the strategy of using the premium money as investment capital falls short for me. Paying the premiums gives me the coverage now and later.

    On personal liability insurance, the cost is so downright dirt cheap that for me it is a no-brainer. I have ONE MILLION DOLLARS worth of coverage for less than $200 a year. What the hey! Wink

  5. Retired To Win Says:

    Miz Pat Says:

    "I made a call for a quote on long term care. I put it off, because I am scared of the thought, but being without it would be even scarier.

    Thank you - you give good advice. God bless you."


    You are too kind, Miz Pat. Thank you.

  6. Retired To Win Says:

    Snafu says:

    "...I'm jumping back and forth on long term care... For $200 a month in a Dividend ETF or RIEF ETF I should be able to fund LTC if needed. If not needed it would be part of my estate. The policies I've looked at have daily limits and I've no idea of what type of care will be needed or the cost..."


    Well, I do wish you luck. Facility rates over here START at upwards of $150 a day and they keep going up. (I have an escalator rider in my policy.) And Medicare does not cover longterm care, and neither does the whatever-you-want-to-call-it new health insurance system we are under now.

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