What Is Long-Term Care Insurance All About?

You have worked hard for the assets you have acquired and the life you live, and you have also set money aside for your retirement. But, what if the unexpected happens and you suffer a catastrophic injury or develop a debilitating illness and cannot care for yourself for any length of time?

Who would care for you?
How would you pay for the care you need?

Long-term care insurance can pay for this care, when you need it, and where you choose to receive it. It can also allow you to keep your independence and spare your loved ones the financial and physical burden of having to care for you.

What Is Long-term Care?

Long-term care refers to a variety of services, including assisting with both the personal and health care needs of someone who is disabled or suffers from a chronic medical condition. This typically includes assisting the person with their medical needs, as well as, daily activities like bathing, dressing, toileting, meal preparation, feeding, and other personal tasks that they are unable to perform by themselves.

Who Needs Long-term Care?

While most people think long-term care is for seniors only, an accident or illness can result in you needing long-term care, regardless of your age. It is estimated that 60% of adults aged 65 years or older will need long-term care at one point or another in their lifetime. But, it has also been estimated that 40% of the people receiving care are between the ages of 18 and 64.

The Cost Of Long-term Care

The cost of long-term care varies depending on the type and extent of the services required. The cost can also vary widely depending on where the services are rendered. For example, the cost of an in-home caregiver is around $20/hour, or approximately $42,000/year, while the cost to stay in a private nursing facility is between $80,000 to $100,000 per year.

Paying For Long-term Care

Unfortunately, many Americans still believe that their private health insurance, Medicare, or Medicaid will cover long-term care when they need it. But, for many people, this is simply not true.

Private health insurance usually only pays for doctor’s visits and hospital bills. Medicare only pays for short term stays in a nursing home or rehabilitation facility. And, Medicaid will only pay for long-term care if you have very little income and few assets.

This means that if you need it, you will most likely have to pay for long-term care from your savings or retirement account and, given how expensive long-term care can be, those resources can be depleted very fast.

What Is Long term Care Insurance?

Long-term care insurance is a type of medical insurance that protects you from the tremendous financial drain that long-term care can be on your estate. Many types of long-term care insurance options are available depending on a variety of factors, including your age, location, health, and your specific needs.

Who Purchases Long-term Care Insurance?

Most long-term care insurance policies are purchased by people for themselves. These individuals are typically approaching retirement and want to protect their assets and inheritance and to avoid being a burden on their families.

Other individuals purchase long-term care insurance for their parents. These are often people who are raising families and paying all of the related costs for their own children, as well as, taking care of a parent or aging loved one who may need long-term care in the future.

When And Where Should You Purchase Long-term Care Insurance?

If you are thinking about purchasing long-term care insurance, don’t wait too long. The best time to buy long-term care insurance is during your 40s or 50s, when you are still in good health and, consequently, the premiums are more affordable.

You may be able to purchase long-term care insurance through your employer, an association, a membership group, or an insurance agent. Or because everyone’s needs are different, you can sit down with an experienced estate planning attorney who can help you devise a plan that works best for your needs and budget.

Learn More About Long-term Care Insurance

You have dreams of living a full life. Don’t risk losing it all to the cost of long-term care. Purchasing long-term insurance can be an excellent way to protect your nest egg and retirement funds from being depleted by the cost of long-term care should you need it.

To learn more about long-term care insurance and to explore other long-term care planning solutions, consult with an experienced estate planning attorney.

Consult with an Experienced Estate Planning Attorney

When drafting a trust, you should always enlist the assistance of a qualified estate planning attorney. An experienced estate planning attorney can help you avoid many of the problems that can render your trust ineffective or useless. For more information, contact us or sign up below for one of our events.

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