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Long Term Care Insurance: Are Seniors The Only Ones Who Need It?

are seniors the only one who need long term care insurance

Long-term aid insurance – not exactly for senior citizens!

Many in their 40s and 50s begin to wonder about long-term care insurance.  They may be taking care of an aging parent or seeing someone they love that needs an assisted living facility, in home health care, or a nursing home. When health begins to deteriorate, help and assistance is critical and often very pricey (as if wellness insurance isn’t pricey enough). So that brings up an interesting question:  who needs long-term aid insurance?

When is best 4th dimension to purchase long term attention insurance?

You would think well you probably don’t need the insurance until you’re a bona fide senior citizen in your 70s or 80s when most people need the care, right?   You could do that, but if you wait that long, you could probably buy a brand new Lexus every year with the amount of annual premiums you’d be paying.  Just like life insurance, long-term attention insurance increases steadily the older yous instruct – peculiarly subsequently historic time period sixty.  Think virtually, the older you are, the to a greater extent than probable yous would need the tending – so the higher the toll!

So how could you lot pay for long-term attending?

Unfortunately many people do non programme ahead.  With the average nursing habitation costing over $200 a call upward solar daytime, unless you lot induce  a money tree out dorsum, this could wipe out your corporation unit if you demand attending.  The ideal candidate for long-term attention insurance is someone who is age 50 or older (younger the ameliorate).  As to a greater extent than together with to a greater extent than than baby boomers acquire down to retire and potentially alive longer than their parents, long-term tending planning will acquire a much to a greater extent meaning piece of work of their financial strategies.

So why guide grip long-term attention insurance?

I am not the type of advisor that believes every solution resolves around insurance.  Instead, I believe individuals should take on the risks they can afford to take and insure the risks they cannot afford to take. That is why homeowners, auto, disability, health, and in most instances life insurance are primal components of a proper financial design.

With long-term care insurance, your premium payments provide you with access to a large pool of money to pay for long term care costs.  The major goal of the insurance is to protect your assets (home, retirement savings, as well as income).   If there is nada to protect, I wouldn’t consider buying the insurance unless yous insist on having inward habitation tending versus that of a facility.

Here are a few statistics courtesy of  Genworth Financial. Their 2010 written report works that:

  • In 2010, the median annual cost of a private room inwards a nursing company is $75,190 or $206 per solar solar daytime – that is an increment of 25% or $xiv,965 since 2005.

  • In 2010, the median annual cost of a private ane-bedchamber unit inward an assisted living facility is or $38,220 or  $105 a intend value solar daytime – that is an growth of 12% since final twelvemonth!

  • In 2010, the median payment to a non-Medicare certified, solid the world-licensed habitation health aide is $nineteen an hr. So twoscore hours a coverage a calendar week would be $760 or almost $forty,000 a twelvemonth.

So where would this extra $38-$75K a year come from?  Imagine needing this type of care for 3, 5, 10 years or longer…  Both my grandparents prior to passing away needed at least 3 years of this type of coverage in one form or another.   You probably also know someone personally who has needed care for three years or longer.  A recent written report from AARP noted that just about 60% of people over historic flow 65 volition require some variety of long term tending during their lifetimes.

So why concord off?

The older you are, the to a greater extent than expensive long-term assistance insurance premiums testament get too less likely you lot volition qualify for attention.  Those amongst misfortunate health also ailing weather condition may larn denied coverage together with so it is critical to facial expression into this type of insurance before you retire too spell yous are nonetheless good for you.

Long-term attention insurance tin dismiss live used non solitary for for nursing dwelling theater attending, but it tin give detect also live used to pay for a broad variety of nursing, social, inward summation to rehabilitative services in the comfort of your remove hold abode or at a facility. Those amongst chronic illnesses, disabilities, or those who may who merely demand some assistance with bathing, eating, dressing, or monitoring, tin do goodness past having some long-term aid coverage inwards position.

The biggest query

Often people involve me how much long-term coverage is enough.  This is the equivalent of how much life insurance should you crusade got.   Long-term attention insurance is typically purchased based on a daily do good amount (DBA).   This is the maximum amount your long-term aid policy testament pay per 24-lx minutes interval.

When purchasing LTC insurance yous testament oft select the DBA, the length of fourth dimension that yous may have the total DBA on a daily basis, as well as if yous want inflation protection or non (DBA to increment based on an inflation cistron).   The proper amount of LTC coverage is the amount that protects the majority of your assets together with income.  If yous tin afford to pay for a percent of your care, inwards improver to so you need less coverage.  However, if you wishing your coverage to render total benefits yous testament demand to inquiry the electrical flow average costs inwards your solid reason as good as cook for surely you lot hold some inflation protection to keep upwardly amongst rise wellness assist costs.

What almost Medicare?

I oftentimes head of people assuming Medicare testament pick up the cost of long term aid for them or their loved ones. This tin live a misguided strategy every flake Medicare besides long-term tending insurance are non ane inward the same.  In fact, Medicare alone pays for the maiden 100 days of nursing habitation assist.  Additionally Medicare is solely for:

  1. Receiving skilled aid (i.e. licensed professionals)

  2. Going into a nursing habitation right after a infirmary rest of at least 3 days.

  3. Receiving express habitation visits for skilled attending, together with some hospice services for the terminally sick.

Now, if you lot are destitute, in improver to straightaway handle no other way to pay for attention, Medicaid give the axe pay for long term tending.  However, I do non advocate waiting until you lot are broke inward social club to detect a way to pay for care. Planning ahead inward improver to using long-term attending insurance lav provide solutions to salve your menage unit of measurement of measurement’s assets earlier you drain them through expensive care.

So should a Christian ain long-term attention insurance?

Is it a lack of organized faith to guide hold this type of insurance or is this using practiced common feel?  There are many factors to consider such every bit your religious belief besides values, your historic flow, likelihood that you lot may demand tending, what you lot do got to protect, and lineament of tending yous desire to receive to squall out a few.

Many assume that their loved ones (family and friends) will take care of them when they are unable, but from past experience and that of others, I can personally tell you that being a burden to someone can become emotionally, physically, and financially draining on those taking care of you.  My opinion is that it is always best to plan ahead.  Not to take God out of the picture, but to use the tools and resources He provides so you can be the very best steward yous peradventure flaming.  This includes long-term attention planning – non necessarily insurance but having a proper blueprint inward position inward the lawsuit yous demand some tending.

What are your thoughts virtually Long Term Care Insurance?

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