There are two questions people ask themselves when they think about long-term care.
First, “Who’s going to take care of me?” The most common care options are family, a home-health nursing service or an assisted living facility.
The second question is, “How am I going to pay for it?” The average assisted living facility costs $6,000 a month (that’s $72,000 a year) and the average stay is four years. Do you have $288,000 in savings that will allow you to self-fund your assisted living stay? If so, that is great news, and your diligent financial planning will serve you well. If not, it is worth exploring your options.
The biggest myth about long-term care insurance is that it is unaffordable if you’re over 50 years old. While the optimal age to purchase long-term care insurance is 50, there are many flexible plan options that can work with you at any age.
Here are two real-life examples of customers I’ve worked with to secure long-term care. Quick disclaimer: all premiums and coverages are subject to the individual, of course!
Customer 1 (female, age 69, no tobacco use, in excellent health) secured a traditional long-term care policy for approximately $300/month. The policy would pay $6,000/month for five years. The premium is fixed for one year at a time and builds no residual value—just straight long-term care coverage.
Customer 2 (female, age 60) requested a hybrid long-term care policy. The hybrid policy provides long-term care coverage but provides a death benefit and cash value if the long-term care benefits are not used. The premium is fixed and cannot go up. This customer paid a one-time premium of $65,000 with a 100% return of premium feature and no surrender charge.
I hope this article can open a discussion between you and your loved ones about long-term care. Go through these questions together, and then take the next step. Contact us to discuss your options for giving you and your family peace of mind about the future.