The Covid Pandemic has increased people’s interest in Long-Term Care Insurance. Many Assisted Living and Memory Care businesses have been in the news. People are thinking more and more about Long-Term Care and making sure they can afford it. They should also be asking themselves Is Long Term Care Insurance Worth It.
Here are some statistics about Long-Term Care to consider when you are wondering “Is Long Term Care Insurance worth it?”:
· Anyone 65 or over has about a 70% chance that they will need some type of Long-Term support or care sometime during the rest of their life
· Women tend to need care for a longer period than men – mostly because they live longer. The average care needs are 3.7 years for women and 2.2 years for men, but not necessarily in a facility
· 33% of older Americans may never need Long Term Care, but 20% may need it for over 5 years
Factors to Consider when Asking “Is Long Term Care Insurance Worth It?”
Just as when you’re trying to figure out how your money will last in retirement, it pays to talk to a financial advisor. They can help you figure out whether you should put your money into a Long-Term Care policy or invest it somewhere else. Here are some things to think about when talking to your advisor:
· What percentage of your income will the Long Term Care policy premiums be? If you have a high net worth you can think of it as a safety net rather than an investment
· For many long-term care residents, benefits ran out before their stay in the facility was over. Your financial advisor may be able to offer ideas for investing to cover the rest of the stay
· There are many types of long term care policies. Make sure your policy covers assisted living and in-home care. You want to make sure all options are covered
· As with other insurance policies, there is a maximum amount of benefits paid out. So when a family member needs long term care, make sure you shop around
· Medicare or other health insurance policies do not cover long term care. Medicaid will pay for some long term care, but you must have a very low net worth to qualify
· Average costs for long term care insurance as of 2021 are about $950/year for a 55-year-old man to pay $165,000. A 55-year-old woman (since they generally live longer) will pay $1,500 annually. Those premiums go up to $1,700 and $2,700 for 65-year-old men and women respectively
· Like life insurance, your overall health will also factor into those premiums
So is long term care insurance worth it? That’s a question best answered based on your financial situation, health conditions and your financial advisor. If you’re located in areas around Surprise Arizona, Goodyear or Mesa, we can recommend some excellent companies that can help you with any long term care financial needs.