Yet only 3 in 10 have made a plan to address this issue. Why would people worry about a problem many of them will face (70% per HHS), but take no action to mitigate it? I’ve concluded the reason is that they think the insurance to pay for LTC is too expensive.
Many insurance agents will not work with LTC strategies as it is too different from what they typically do. If they do, they may have only one of two solutions to work with. Surely you would not go to a podiatrist to have a tooth pulled. He is a doctor, but does not specialize in what ails you.
I am a specialist that for the past 22 years has worked exclusively in the field of financing LTC. It turns out that LTC insurance is the least expensive way to plan for care in later years – if you investigate it while still healthy enough to get it. To address those price fears let me offer the following:
A 65 year old, whether male of female, can have over 3/4 of a million dollars of LTC insurance overage for under $2000 a year premium. Is that expensive, or a pretty good deal? Could you invest $2000 a year and end up with 3/4 of a million dollars in the stock market? And what if you needed care just 3 years later, you would have $6000 and a bit of interest (or maybe some loss).
Now, here is the disclaimer: a 65 year old person gets $70/day LTC insurance benefit. This will, along with a Social Security check, cover most of home care or assisted living facility costs, which is 80% of the care used today. There is a 90 day deductible (elimination period), and it includes an automatic 5% compound increase in the daily benefit. If care costs less than the insurance benefit, the excess cash is given to you and is income tax free.
After paying the tax deductible premium of $1980.94 each year for 20 years, the total spent on premiums is $39,618.80. If care is needed then, the benefit paid out (with the automatic 5% compound inflation factor) will start at $195/day. It will increase each of the 10 years you can collect from this policy, giving you a total available over 10 years of receiving $852,603.
Some may counter that people don’t typically spend 10 years in a nursing home, and I agree. This will pay for in home care, adult day care, assisted living facility care or a nursing home, but will not be enough cash flow for a nursing home.
Most LTC is done in your home or in the assisted living facilities. The mentioned insurance benefit and a Social Security check will allow you to pay for in home care, or an assisted living facility (where most care is done) and hopefully keep you from ever seeing the inside of a nursing home. It will hopefully keep you from having to spend down to Medicaid impoverishment (which includes having to cash in life insurance over $1500). Your heirs will be able to inherit what you have at death. Most importantly, when you pay for the care you need, you can go anywhere you want to obtain that care. Your children will not be stuck caring for you, or deciding what to sell first when you cannot afford care.
For more information, visit www.TheLongTermCareGuy.com or call (800) 219-9203 to start investigating.