Living a long happy life is a great thing. There is a problem with longevity that few of us can ignore. With longevity comes a greater risk of needing long-term care. You might say, “I’m healthy, that won’t happen to me”. Unfortunately, your good health leads to living longer which leads to a greater risk of needing help with everyday living activities or supervision due to cognitive decline.
Questions to Ask Yourself
You should start to think about the financial costs and burdens of aging in your 40s or 50s as part of your overall retirement planning. Ignoring this issue will not only impact you it impacts your entire family. Exactly which one of your children will become either your primary caregiver or will manage how your money is spent on paid long-term care services? How will that pressure on their emotions and their time impact their careers, families, and other responsibilities?
If they are just managing your care will they make the exact same decisions you would make on how your care is delivered and which accounts would be liquidated to pay for these services? How will these decisions affect your quality of life, lifestyle for both you and your spouse if they are still living at the time, and your legacy?
The Impact of Care Costs on Your Legacy
The cost of long-term care services and supports are very expensive. Exactly how expensive? Most people and their families are shocked at the high costs. They figure that health insurance or Medicare, including supplements, will pay for the majority of care. That is false.
The fact is they pay very little for long-term care, limited to no more than 100 days of skilled services. Most long-term care is custodial. This means help with activities you take for granted which become much harder either due to an illness, accident, or the impact of aging.
Take a moment and think about simple things like taking a shower, getting in and out of bed, going to the bathroom, eating and dressing, all the things that normally we never think twice about. As you get older or are affected by an illness or injury, you will need either “hands-on” assistance or “stand-by” assistance with some or all of these activities.
You might require supervision due to the many forms of dementia, including Alzheimer’s. We know more people are diagnosed with some form of dementia than ever before. This is due to our longevity.
As you spend your money to pay for these services it has a tremendous impact on your everyday lifestyle. Your hard-earned money, even if you enjoy a large estate, can drain quickly.
Cost of Care Services Vary Depending on Location
Where you live will have a big impact on how much care will cost. The LTC NEWS Cost of Care Calculator will tell you both the current and future cost of these services in your area, or an area of the country you wish to live in the future. Access this tool by clicking here.
For example, if you live in Knoxville, Tennessee, the cost of care at home, based on a 44-hour week, is $3,575 a month based on 2019 averages. If you are 53 years old today, in 25 years when you are 78 years-old that cost is expected to be $7,710 a month.
An assisted living facility in Knoxville, in 2019 is averaging $4,033 a month for base services (additional costs on top of that depending on your needs). However, in 25 years that same facility will run about $8,696.
A nursing home today in Knoxville is averaging $7,026 a month but in 25 years that would run $15,153 a month!
Compare Knoxville with Eugene, Oregon. That same level of care at home is averaging $5,100 a month, compared to Knoxville’s $3,575 a month. A skilled nursing home in Eugene is now $9,946 a month, compared to Knoxville’s $7,026 a month. This means the future costs will also be greater.
Long-Term Care Insurance is Custom Designed
This is one of several reasons affordable Long-Term Care Insurance is custom designed. This way, you plan for the expected costs where you plan on living. You also design a plan based on your level of co-insurance. This means you might decide you can pay for a little bit of your care in addition to the insurance company paying an amount.
45 states offer special Partnership Long-Term Care Insurance policies that offer dollar-for-dollar asset protection. You can design a plan that protects the amount of assets you wish to preserve.
Seek Help of an LTC Specialist
Too often an individual will speak to their financial advisor or general insurance agent for quotes with Long-Term Care Insurance. They often lack the necessary skills and experience in long-term care planning to provide you with accurate quotes and information.
Usually, only a specialist will have access to most, if not all the major insurance companies offering these products. They also lack a complete understanding of underwriting which will have a dramatic effect on eligibility and price. Most fail to understand the importance of the partnership program which could be a very key part of your overall financial plan.
Finally, they often have never processed a claim from a Long-Term Care Insurance policy. This means they have little understanding of the impact these plans can have on both family and finances. The result is they too often recommend benefits which are much greater than you need.
Get Accurate Quotes and Recommendations
Don’t spend more than what you need to for a Long-Term Care policy. The fact is these policies can be very affordable for most people. Premiums can vary well over 100% for the exact same benefits when you compare companies.
LTC NEWS can help find you a trusted and experienced advisor who will help you find the best coverage at the best value. Find a specialist by clicking here.
Give your family peace-of-mind by planning for long-term care before you retire.