If you’re like me and your life has more history than future, you’re probably planning for your “golden years”.
Although it may seem too early to think about long-term care when you’re in your 50s and early 60s, that is the ideal time to insure against the high cost of long-term care services. Buying long-term care insurance now will result in a lower premium and higher future benefits than if you wait to buy it later. It’s also important to purchase insurance while you’re still healthy in order to increase the likelihood of policy approval, plus you’ll have a policy in place if the unexpected happens, such as a disabling accident or the onset of a devastating disease.
As you’ve probably heard, or experienced with a loved one, long-term care expenses are very high. Currently, you can expect to pay about $50,000 or more per year for home health care, for homemaker services, or to live in an assisted living facility. A person who requires care in a skilled nursing facility can expect to pay $100,000 or more per year. According to U.S. government statistics, about 70% of people over the age of 65 will need some level of long-term care services in their lifetime, so the odds are high that most of us will utilize such services someday.
For most people, paying for long-term care services without the aid of insurance depletes their assets quickly, often leaving the spouse with a reduced ability to pay household bills and to enjoy the lifestyle they’re accustomed to. It may also put a burden on other family members, assuming they are willing and able to provide the type of care that is needed. Unfortunately, health insurance and Medicare pay little or nothing for long-term care, so family savings or long-term care insurance are the only good ways to fund these expenses.
As you know, interest rates on savings accounts, CDs, and bonds are at historic lows, so money saved in these vehicles is barely growing. And, as we’ve recently experienced, the stock market goes up and down (sometimes fast and hard!), so relying on investment accounts to fund long-term care is uncertain, volatile, and stressful.
That’s why a long-term care policy is the perfect solution. It requires just one up-front payment and immediately provides a coverage amount well in excess of the initial payment. Additionally, the coverage amount is guaranteed to grow every year at a predetermined rate.
Long-term care insurance eliminates the uncertainty of how much money you’ll have available for long-term care expenses in the future, and some policies even guarantee to return the premium anytime in the future if you choose to discontinue the policy before using the coverage.
Contact Dave Boer if you’re interested in learning more about long-term care insurance and how it can provide the peace of mind we’re all seeking these days.