For many of us who are 45 + we are planning for retirement in a period of uncertainty. Huge questions about how we will afford to retire is on our minds. You add questions regarding the economy, taxes, healthcare and more and you sometimes just want to forget about the whole thing.
One of the biggest risks we face is the risk of needing and paying for long-term care services. I know, thinking about home care or nursing homes and assisted living facilities is not exciting. We never see ourselves needing care … it is always going to be someone else. But facts are facts.
According to the U.S. Department of Health and Human Services, “70% of those 65 or older will need some form of long-term care at some point in their lives.” That’s nearly 3 in 4 of us. 40% of all those needing care are under the age of 65! For many of us, long-term care insurance is the answer to protecting our assets and making sure we are never a burden on our family. 3 in 4 need more! There is even a national educational campaign that has started with this theme, 3 in 4 need more than just traditional healthcare (www.3in4needmore.com).
As record numbers of boomers continue to age, their health problems rise in direct proportion. If you’re over 40 and haven’t yet made decisions about how you will pay for future care and how it will be delivered, then you need to start working on it.
Health insurance and Medicare pay for little or no long-term care. What they will pay for is a limited amount of skilled care for a short period of time. Most long-term care is custodial in nature. This means you will need help with what they call “Activities of Daily Living” or “ADL’s” for short. These are things like eating, bathing, tolieting, etc. Things we really take for granted each and every day.
Medical science allows us to live longer and longer. Things that used to kill us no longer do. This is good … but. The “but” is when you live it also means we don’t die as easily as in years past. We need help. The quality of life is not what any of us would like. This creates a tremendous emotional, physical and financial burden on our family … unless we plan and plan now.
When you do need care most people will rather it be in their own home. This is good because most family members would rather you be in your home (not their home or a nursing home!).
Long-term care insurance (get details about that at www.completelongtermcare.com ) is a very affordable way to have a tax-free pool of money and professional help to assist the family to make sure your needs are met the way they should be.
Cost of care can be very expensive. This interactive map produced by Genworth Financial shows the cost of care where you live – www.genworth.com/content/products/long_term_care/long_term_care/cost_of_care.html
With many 401ks being a little less today we have to have more. Since 3 in 4 of us will need care … we better not wait before we plan.
What about the government? President Obama’s Health Care Reform doesn’t really deal with long-term care other than setting up the so-called “Class Act”. This will provide a small benefit but at a high cost. The big benefit would be that there will be no good health requirement in order to sign up. Long-term care insurance will provide much more benefit at less cost …as long as you act before your health changes.
The federal government has set up a group long-term care insurance plan for federal employees (like President Obama) and many take advantage of the plan. Heath requirements can be less during open enrollment but benefits are a bit limited and the cost can be higher than an individual plan.
Most states are taking part of the federal/state partnership program which can provide for asset protection IF you have a qualified long-term care policy. This allows you to keep assets if you ever exhaust your long-term care insurance benefit.
In addition, federal and state tax incentives can be available as well.
The bottom line is this. Talk to a long-term care specialist. Many insurance agents can sell this type of policy, but very few really understand it and specialize in it. ACSIA agents across the country do specialize in long-term care (as well as other agents). You can find an ACSIA agent at www.acsia.com.
The best thing is, don’t delay, act now while you have good health and age as an advantage. You wait till you are 70+ and you may find limited options and a higher cost depending on your exact age and health. Most people are looking at long-tem care insurance in their 40’s and 50’s.
Good luck and once this is done you can say, “next”!