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Planning for Long
Term Care Expenses
Failing to plan for the costs associated with long-term care can wreak
havoc on your nest egg. Long-term care insurance can help preserve the
assets you’ve worked so hard to build.
As the baby boomer generation ages, statistics indicate a growing need
for long term care. It is estimated that sixty percent of people who
attain age 65 may require long term care at some point in their lives.1
But the need for long term care is not limited to retirees. Studies
reveal that 40% of people receiving long term care services are working
age adults, between the ages of 18 and 64.1 Their need can
result from chronic illness, injury or disability.
Many Americans are currently dealing with the emotional and financial
impact of providing for the long term care needs of a family member. In
home care is often delivered by a relative who may be burdened with both
childrearing and elder care responsibilities. And while the services of
a home health aide may be enlisted, the average annual cost of home care
is well over $20,0002 for just 25 hours of care per week. By
2030, this cost is expected to reach $68,000.3
Furthermore, the average annual cost of a semi-private room in a nursing
home is currently $52,000.2 By 2030, this figure is projected
to skyrocket to $190,600.3 With the average nursing home stay
estimated at 2.6 years,4 the total cost will approach nearly
a half million dollars!
Will you have saved enough to pay for these types of expenses? And, if
you did, would you want to spend your savings on long-term care?
Unfortunately, some people believe that their health insurance, Medicare
or Medicaid will foot the bill for long-term care. But most health
insurance plans normally cover only acute care that is required for a
short period of time. Medicare offers limited benefits for those who
receive care in a skilled nursing facility following a hospital stay.
Generally, Medicare recipients are disabled or have reached
full-retirement age as defined by the Social Security Administration.
Medicaid is a government program designed to help those in dire
financial need. In most cases, almost all of your assets and your
spouse’s assets must be depleted before benefits will be paid, and even
then Medicaid will not cover most home care, which is the setting most
people prefer.
That’s why many people seek to protect their assets by purchasing
long-term care insurance. With long-term care coverage, it is possible
to defray the expenses of extended care without placing your income,
retirement nest egg and other investments at risk. In addition,
long-term care insurance can provide for increased control over your care
choices and the peace of mind that comes with knowing your future needs
are covered.
As your Legend Advisor, I can meet with you to help you define your
goals, evaluate your long-term care options and create a plan that services
your needs.
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