Medical care is expensive, and long-term residential care can be even more so. People pay thousands of dollars each month for space in nursing homes and similar facilities.
If you are about to start to plan for retirement or are reviewing your estate plan now that you have reached retirement age, the potential expenses of long-term care may weigh heavy on your mind.
Depending on your situation, you might benefit from investing in a long-term care insurance policy. Learning a little bit more about how these policies work and help you determine if one would benefit you.
Why might you need a long-term care policy?
Residential care or skilled nursing services in your own home are expensive. Medicare will not cover these costs, and the same is true for many private insurance policies. You may need to pay out of pocket or find a way to qualify for Medicaid to cover the costs of these more intensive services. Long-term care insurance closes that coverage gap by paying for nursing home care in the future.
Who should consider long-term care insurance?
Obviously, those at or past the age of retirement will be the most likely to recognize that they could use long-term care insurance to protect themselves and their financial legacy for their families.
Unfortunately, by the time you are in your 50s or 60s, the cost of long-term care coverage may already be prohibitively expensive. Premiums go up as you age. Additionally, coverage is often lower for older adults.
Buying into a policy early in your professional career can help you lock in lower rates and higher coverage levels. Comparing the total cost of your policy over time with the maximum benefits you can receive will give you an idea of whether the policy is worth what you will pay for it.
There are other ways to cover the costs of the care you need
If you are already at an age where long-term care insurance coverage is too expensive or if the policies available to you won’t offer enough protection, there are other ways to protect yourself from the expenses of long-term care. Long-term care planning and Medicaid planning are both processes that might help you plan for potential future medical expenses.