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Long Term Care Insurance: Preparing for your Future

Planning ahead for your retirement?  There are lots of things to consider.  One big issue is what happens if you are no longer able to care for yourself?  First and foremost, long term care insurance is NOT just about nursing home care.  Unless you buy a nursing home only policy, it will include home health care and lots of other options that prevent you from having to move to a nursing home.

According to an article in Investopedia dated September 26, 2016; about 10,000 people born between 1946 and 1964 are “heading into retirement in droves.”

The NAIC has partnered with Rita Moreno to help educate and inform people about the importance of retirement preparation before it’s too late.  Ms. Moreno tells her story of not taking an active role in understanding their finances, and when her husband passed away, she was lost.

The need for long term care insurance is greater than ever.  Parents and their adult children in most cases, no longer live in the same city or even state.  They are spread throughout the country.  Children have their own families and taking care of parents when they can no longer care for themselves just doesn’t exist like it did in the olden days.  Previously, most people would take on the care of their elderly parents. In today’s society, women are no longer expected to say at home and be caregivers. Per the United States Department of Labor, 57% of women participate in the labor force.

Portrait of a happy old couple shaking hand with advisor at office

Portrait of a happy old couple shaking hand with advisor at office

This cultural shift in society from children automatically caring for their aging parents to placing their parents in a nursing home is becoming more prevalent. We have to make the best of it and prepare accordingly.  So the issue is, when people are no longer able to care for themselves and their families can’t or won’t care for them, what is the answer?  One of the answers is to prepare for the future as early as possible by buying long-term-care insurance.

Tips for buying: buy as early as possible, when you are healthy and your premiums are low.  Buy the best policy you can afford, even if it stretches the budget a bit; you will thank yourself when you need it.  You may ask what if I never use it and now I have spent all of that money on premiums through the years?  Buying long term care insurance is a win, win situation; you don’t get many of those in life.  If you need it, then you have it.  If you don’t use it, then it means that you have remained healthy enough not to have to rely on it.  You buy car or home owner’s insurance to cover potential perils, don’t you?  But how many times have you filed a claim?  The same goes for long term care.

If you think you can’t afford long term care, then consider short term care insurance.  The premiums are much lower, but so are the benefits.  It is better than not having anything.

You say that you have enough money to self-insure?  Consider these facts:

  • According to 2015 Medicare & You, Centers for Medicare & Medicaid Services; at least 70% of people over 65 will need long term care services and support at some point in their lives.
  • The average length of a nursing home stay is 835 days (2.3 years) was reported by the Centers for Disease Control and Prevention, Nursing Home Care FastStats, last updated May 2014.
  • The median cost of a private room in a nursing home in the United States is $92,378 per year, or $253 per day, according to Genworth, one of the leading long term care insurers.

Let’s do the math:
835 days x $253/per day=$211,255

Now do you still think you have enough money saved to cover the cost?  Remember a key selling point with having long term care insurance is that you do not have to spend down all of your assets.  So that $211, 255 could go to your beneficiaries rather than to a nursing home.

But long term care is not just about nursing home stays.  Depending upon the policy you buy, it will most likely cover home healthcare.  You can have services to assist your needs directly in the comfort of your own home.   The important part of all of this is find a reputable agent who understands long term care insurance to help you decide what policy best suits your needs.  There are many different features and benefits from which to choose.

I read the story below, and it inspired me to write this blog.  It made proud that today there are still people who show respect, care and concern for the elderly.  Author is unknown.

Evening Dinner with a Father

A son took his old father to a restaurant for an evening dinner.  Father being very old and weak, while eating, dropped food on his shirt and trousers.  Other diners watched him in disgust while his son was calm.

After he finished eating, his son who was not at all embarrassed, quietly took him to the washroom, wiped the food particles, removed the stains, combed his hair and fitted his spectacles firmly.  When they came out, the entire restaurant was watching them in dead silence, not able to grasp how someone could embarrass themselves publicly like that.  The son settled the bill and started walking out with his father.

At that time, an old man amongst the diners called out to the son and asked him, “Don’t you think you have left something behind?”.

The son replied, “No sir, I haven’t”.

The old man retorted, “Yes, you have!  You left a lesson for every son and hope for every father”.

The restaurant went silent.

Moral: To care for those who once cared for us is one of the highest honors.   We all know, how our parents cared for us for every little thing.  Love them, respect them, and care for them.

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