Long-term care insurance offers essential protection against the potentially high costs of extended care services, such as nursing home care, assisted living, and even in-home care. Here’s why investing in long-term care insurance is prudent:
1. Financial Security: Long-term care expenses can quickly deplete savings and retirement funds. Long-term care insurance provides a financial safety net, ensuring your assets remain protected, allowing you to maintain your standard of living.
2. Preserve Independence: With long-term care coverage, you can afford quality care without burdening family members. It enables you to maintain independence and dignity by accessing the care you need, when you need it.
3. Rising Healthcare Costs: Healthcare costs, including long-term care, continue to rise. Investing in insurance now can shield you from future increases, providing predictability and peace of mind for you and your loved ones.
4. Flexibility and Choice: Long-term care insurance offers flexibility in choosing the type of care and where you receive it. Whether at home or in a facility, having coverage ensures you have options tailored to your preferences.
5. Protect Loved Ones: By securing long-term care insurance, you relieve your family of the financial and emotional burden associated with providing care. It allows your loved ones to focus on supporting you emotionally rather than worrying about financial obligations.
Medicare will not cover Long Term Care. Medicare will only cover Skilled Nursing Care on a temporary basis for a specific need in their approved facility.
Long-Term Care Planning is probably the most important piece of coverage you could have in your retirement plan. There are several good options for Long Term Care Coverage that can assist, or cover in full, the extensive cost associated with these services. The national median for a semi-private room cost in 2023 was just over $104,000, while a private room was $116,000. That is up 8.5% in just three years. Those costs are expected to grow to $171,000 and $193,000 by 2040 respectively, according to Genworth Financial Inc.’s cost of care survey. Those rates can rapidly erode a retirement account and other assets.
- When you think about your overall goals, do you plan to completely spend down your assets so Medicaid can place you into a facility of their choosing?
- Do you have a good understanding of the costs of different types of caregiving services in your area, such as skilled nursing home care, assisted living, and in-home care?
- If you needed care, on the very first day, where would the money come from?
Which assets would you sell first? - Would you want a family member to be your caregiver in any capacity?
- If you would ever need care, what would your family be prepared to do physically and financially?
- Are they aware and feel comfortable that this is your plan?
- Are they willing or able to sacrifice time to provide assistance?
- Would you be interested in a long-term care solution with premiums that remain constant and do not increase in the future?
- Would you be interested in a long-term care solution that provides other benefits if you never need care?
Traditional Long Term Care plans are not available for everyone. There are hybrid types of Long Term Care policies that may be a better fit for your needs. Underwriting may be involved, however there are also great Home Health plans and Short-Term Recovery plans available with less underwriting.
Follow this link to start a discussion about retirement planning and your Long Term Care options.