Vertical settlements to help with bills, healthcare, house renovations, and more
John developed cancer many years ago. His doctor told him that he would never be cured. John did well in the past 7 years. But now he has had a recurrence.
John has reviewed his treatment options with his health care team. His team estimates that he has 12 to 18 months to live. John has now realized that he has not done near enough planning for his wife Mary Ellen.
John and his wife had planned their retirement carefully. However, their roof needs to be replaced and John knows that Mary Ellen will want to stay in the house after he is gone.
Their mortgage was paid off and John did not want to take out another mortgage and burden Mary Ellen with the debt. John heard from his social worker at the cancer center that if he had life insurance he could possibly borrow money against it.
John and Mary Ellen can sell their life insurance for cash to a vertical settlement company. Over the past several months vertical settlement companies and brokers have ramped up their advertising on television and social media as you have probably noticed offering their services to seniors.
The amount you get in a vertical settlement is a reduced value of the policy. The company pays all the future premiums and then collects the policy’s full benefit when you die.
There are some vertical settlement restrictions
- You have to have a life expectancy of five years or less. If it is less than 2 years, you won’t have to pay taxes on your settlement.
- You do not have to be over 65 for this program.
There are several options – you can sell your policy, or take out what is called a ‘secured no-payment’ loan against your policy. This works like a line of credit, which means you can use what you need when you need it, and you will only owe what you borrow.
John got the new roof without burdening his wife with debt by selling part of one of his life insurance policies
CAUTION - In working with cancer patients and families for the past 20 years I understand that medical bills, necessities, food, rent, or the mortgage payments along with the cancer battle might make it tempting to jump into one of these agreements. Like any investment do your homework before entering into any type of vertical settlement agreement. Have a trusted family member, friend, cancer advocate, attorney, or investment advisor look at the agreement and provide guidance before moving forward.
End of life issues are very personal and should include a living will. I would suggest using a document called ‘Five Wishes’ from an organization called Aging with Dignity.
The form will bring you a sense of relief – it gives you a way to take care of something very important to you and the ones you love.
Questions like who you would want making medical decisions for you if you couldn’t make them for yourself?
What kind of medical treatment would you want if you became seriously ill or were dying. Do you want to be put on a respirator, etc?
Call 1-888-594-7437 for more information.