Long-Term Care. Thinking About it Now Makes Life Easier Later

We hear a lot about long-term care. Most of us want to ignore the topic since it is not very pleasant. However, long-term care services are a vital part of health care. With the growing demand for care and accelerating costs, failing to plan can be devastating for families and finances. 

Long-term health care aims to ensure the individual's quality of life that due to an illness, accident, or the impact of aging, needs help and assistance with daily living activities and general ongoing health care due to chronic health issues. Included in long-term health care is the supervision many people will need due to cognitive decline from Alzheimer's Disease or other forms of dementia.

What happens is we become dependent on the assistance of others at some point in our lifetime. Usually, senior citizens are the recipients of this kind of health care service; however, younger people may require extended health care for many reasons, including accidents, cancer, MS, strokes, and Parkinson's Disease, for example. 

However, most long-term health care recipients are older, and our risk of needing long-term care services increases as we get older. 

Think Long-Term Health Care When Planning Retirement

There are several reasons to plan for long-term health care. As we get older, we all face declining health, body, and mind. The consequences affect families, friends, and finances. 

Here are the top three reasons you should consider the consequences of long-term care when planning out your retirement.

Care is Costly

You must save for retirement. The problem is that saving, whether for long-term or short-term goals, is not a habit many people have picked up over the years. Too often, people spend too much and save too little.

In a 2019 poll survey, less than half of Americans have no savings at all. If you belong to the other half with something tucked away for a rainy day, it would be a wise decision to start setting aside a portion for your long-term health care. Since the average American spends twenty years in retirement, consider having a nest fund that can stretch over that period. 

Better yet, for many people, Long-Term Care Insurance provides guaranteed tax-free benefits that will protect your savings and give you the choice of the care you want, including home care. Most LTC Insurance policies will have an inflation option, so your benefits increase over time as the cost of care increases. 

Rapidly increasing long-term health care costs can worsen the financial devastation on families. Inflation and market uncertainty mean you should have guarantees as you approach your retirement. Long-Term Care Insurance offers those guaranteed tax-free benefits. Loved ones have the time to be family instead of caregivers.

Whether you try to self-fund future long-term care or buy LTC Insurance, you need to understand the current and future costs. If you are in your 40s or 50s, while you could need care in the next ten years, most likely, it will be 30+ years from now. Where will those costs be at that time, and how will you afford to pay them?

Nursing home care is still the most expensive, but most long-term health care is delivered in a person's home. You probably would prefer to stay in your home, and your family would probably like that as well. The problem is with increasing demand and higher labor costs, the costs of all long-term care services and supports are going up at alarming rates.

Look at the LTC NEWS Cost of Care Calculator - Cost of Care Calculator - Choose Your State | LTC News. Find your state and the city you live closest to so you can see the current financial impact of long-term care on income and assets. 

If you play with the calculator, you will see the costs vary depending on where in the country you live. Even within a state, you can see dramatic cost swings from one area to another. If you plan on relocating, consider the costs of long-term health care as part of that equation. 

Unlike Long-Term Care Insurance, self-funding requires a large sum of money set aside just for future care. There are tax implications of self-funding (gains, taxes, losses, etc.). Plus, depending on how you are investing the money, you are subjected to market timing. You cannot time the markets or the time you may need your own care.

Either way, you need a plan.

Taking Care of Relationships

No matter what your current relationships with friends and family may be, it will be challenging for them to manage family obligations alongside caring for you or another loved one in the future. 

The energy, time, and expenses in providing top-notch quality care can easily take a toll on already stressed loved ones. There are many situations when family members can provide the resources needed to keep their senior relatives under their roofs and in their care — and that can be a wonderful experience for some - or at least at first. 

The reality for most is this: you may eventually need to look out for yourself. The role of being a family caregiver is demanding. It is physically a difficult job. However, there are emotions involved, so family caregiving is emotionally demanding as well.

Some family members might be able to offer respite care for the primary caregiver. That can provide the necessary, although temporary, relief. There will often be strife among family members as to who is doing all the work and who is not.  

It usually becomes best, if possible, to bring in professional in-home care or consider assisted living or other long-term care facilities depending on the person's needs. 

Keep in mind, however, that care is costly. Health insurance, including Medicare (and supplements), won't pay for this kind of extended health care. Medicaid requires a person to have little or no income and assets, and then the care choices are limited. Long-Term Care Insurance, if available, gives you the choice of care, but you cannot buy a policy when you need it - it must be done in advance - often when a person is in their 40s or 50s. 

When you are the one that is older and in declining health, consider the needs of your spouse and adult children, who may be forced into the role of a caregiver if you have failed to plan now.

Ensure Quality of Life and Qualify of Care

Because long-term health care can cost a pretty penny, have a savings plan that will either fund future care or purchase Long-Term Care Insurance, which will provide the benefits you will need when you need them.

Planning early gives you plenty of time to save up for more than just a long-term care solution. Once you have prioritized long-term health care as one of your top goals, you can breathe more easily. 

Once you have taken care of one of the most important things to prepare for in life (remember, first things first!), you will have the freedom to pursue other interests and hobbies. You can enjoy peace of mind knowing that you have the means to take care of yourself should crunch time come without becoming reliant on your family or draining assets. You will have the confidence to fully enjoy life with your family and friends with less worry and peace of mind.

Getting Help in Crisis

If mom or dad needs help now it can be stressful. When families are in crisis they will often need help. It is too late to buy insurance. A care concierge can be very helpful. A concierge works with busy family members who don't have time, or the knowledge, to deal with occupational, organizational, or personal tasks. A professional personal concierge is similar to a hotel concierge in that the sky is almost the limit in ensuring that your medical and non-medical needs are met. These can range from helping with housework to arranging for your medical appointments to providing companion support. 

Ideally, you want to address the costs and burdens of aging now when you are younger and healthier. You currently have choices. You can stay in control. Your loved ones will always have the time to be family instead of caregivers. Your savings can be protected. Planning is always better than a crisis.