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Published: Oct 13th, 2017

First Time Millionaires Should Have Long-Term Care Insurance

Millionaires Should Have Long-Term Care Insurance

A million dollars is not what is used to be but more people are getting to their first million. As more people invest in their employer’s 401(k) and other retirement programs their savings are growing. You add the money in retirement plans plus current savings and investments and the value of a home more people just like you will soon (or may already be) a millionaire!

One out of every 10 American households will be worth at least $1 million within the next four years and these individuals should be planning to protect their savings with Long-Term Care Insurance according to the head of the American Association for Long-Term Care Insurance (AALTCI).

"Achieving this milestone is historic for millions of Americans and their number one priority will be protecting that achievement," said Jesse Slome, director of the AALTCI. Slome was speaking recently to key Association members regarding market outlook and future opportunities.

Slome said a recent issue of Bloomberg Business revealed that if we avoid a recession the percentage of U.S. households worth $1 million or more will exceed 10 percent by 2021.

"Individuals who have worked hard and saved throughout their life understand the risks that could impact their net worth, long-term care being the greatest risk as they age. What they don't know is how easy and affordable it can be to mitigate that risk,” said Slome.

Many consumers and financial planners are discussing the financial costs and burdens of aging and how it impacts a retire plan. With the advances in medical science longevity has become a retirement issue.  The concern is the risk of running out of money when you are retired. The cost of long-term care is a big factor many people don’t consider.

Most people want to manage a Long-Term Care situation without becoming dependent on their adult children or spouse. Generally, spouses are not the best caregivers because of their own age and health. Adult children have their own careers and family responsibilities.

Caregiving is hard on family members and is difficult and emotional work. Writing in their blog, “Losing a Puzzle Piece (, Jessica Conway Church and Shane Eleanor Conway McCoin write, “We can’t always paint a rosy picture of caregiving. There are harsh realities, stress, and much hardship involved.”

Long-Term Care Insurance will pay for care in any setting whether it is your own home or adult daycare, assisted living, memory care or nursing home. Quality paid care is not cheap.

Cost of care can vary depending on location. The national averages are:

Median Annual Cost of Long-Term Care 2017

Adult Day Care (5 days/wk.) $18,200
Assisted Living (one-bedroom) $45,000
Homemaker Services (44 hrs./wk.) $47,934
In-Home Health Aide(44 hrs./wk.) $49,192
Nursing Home (semi-private room) $85,775
Nursing Home (private room) $97,455

(Genworth Cost of Care Survey)

To find your state’s averages click here:

Plus just having a million bucks isn’t like it used to be. The Financial Samurai says although being a millionaire sounds nice, it’s not that impressive anymore thanks to inflation. If you retired today at 65 with $1 million and no Social Security, you’d only be able to spend $40,000 – $45,000 a year for 25 years until you’d run out of money (

Most states offer partnership Long-Term Care policies which provide additional dollar-for-dollar asset protection. This will give you extra peace-of-mind to safeguard your hard-earned assets from the high costs of long-term care. Learn more about Partnership Long-Term Care plans here:

If you have assets to protect, whether you have $100,000, $1,000,000 or more, an affordable Long-Term Care policy will help you make sure you don’t run through your savings due to the costs of care. It will also reduce the tremendous burdens extended care puts on family members.

Experts suggest starting your planning before you retire as premiums are based on your age and health at the time to get a policy.