Did you know…
Neither your health insurance nor Medicare would pay for extended long-term care services in the event that you needed them in the future?
If you develop a chronic illness or become disabled and can no longer care for yourself for an extended period of time, you’ll need long-term care services.
And they aren’t cheap.
The median cost for a home-health aide for an eight-hour day is more than $49,000 a year, while nursing care in a facility with a private room has a median cost of almost $98,000 a year.1 As life expectancies increase, so does the duration of long-term care needs, and the financial burden may end up falling on your loved ones after you’ve run through your own life savings.
This section will explain what you need to know about long-term care insurance and offers tips on where to buy it and the best time to do so. There’s also an interactive map to help you get a sense of what long-term care services cost in your area.
1Genworth 2017 Cost of Care Survey
Who Needs It?
Given that the cost of long-term care can quickly deplete your life’s savings, you should seriously consider adding long-term care insurance to your financial plan. Plus, there’s about a 70% chance you’ll need some type of long-term care after age 65.
Should you ever require it, a home health aide visit costs about $19 an hour, while full-time nursing home care in a private room, the most expensive type of care, now has a median cost $84,000 a year. In some regions of the country, like the Northeast, the cost may be well above that amount.1 While financial considerations cannot be understated, long-term care insurance is also about peace of mind and control. Having it ensures you’ll have access to first-rate care when you need it, and that you won’t have to be dependent on others or be a burden to your children. The odds you’ll need long-term care insurance are greater than you might imagine.
Long-term care services are not just for older people: Anyone who’s has been in an accident or suffers from a debilitating illness may also require round the clock care. In fact, 40% of patients receiving long-term care are under age 65. If you can afford to pay for care without significantly impacting your assets, you may not need long-term care insurance. Conversely, if your assets, not including your home, are less than $80,000 if you’re married, or $30,000 if you’re single, you may not be able to afford the premiums. But If you’re somewhere in between, long-term care insurance should be part of the discussion the next time you sit down with an advisor to review your financial plans.
1Genworth 2013 Cost of Care Survey