"Protect your hard-earned assets and secure your independence in the future by taking steps now to implement a long term care strategy."
Somtimes the best investment planning often involves asset protection
The most pressing financial concerns of many people tend to revolve around providing for their families, assuring adequate retirement income and preserving their estates for the future. However, few people consider what would happen to their families, themselves and the assets they have worked so hard to accumulate over the years if they were to require long term care due to a prolonged illness or disability.
It is estimated that approximately 70% of all people over 65 will require some form of long term care during their lifetime. The average annual cost of nursing home care for one person is more than $66,000. Medicare pays for less than 2% of all long-term care cases – including nursing home care, assisted living and custodial care – for a maximum of only 100 days. Medicaid pays for long-term care only after an individual has spent almost his or her entire estate, qualifies as impoverished and is admitted into a nursing home that accepts Medicaid.
Long term care protection can assist in paying for these expenses and leaving more of an individual’s estate intact and putting less of a burden on your family as the expenses associated with a long term care stay often deplete much of a person’s estate.
Early planning will save you money
Like many types of insurance, long term care protection is more cost effective when purchased well before retirement or when the need arises. Unfortunately many individuals put off the purchase assuming they can do so at a later date. As no one can predict when they will need long term care, it is best to secure protection before it is needed.
A Prudential Research Report showed that 58% of Americans believed that they would never need long term care. Yet in reality, almost half of us will spend some time in a nursing home when we are older, while 72% of us will use home healthcare services. Even worse is that 46% of those with health insurance believe that their insurance will cover the majority of the long term care costs. In truth, traditional healthcare insurance is not designed to cover the expenses of an extended long term care event.
When considering the purchase of this benefit, individuals should keep in mind that the best long term care policy is one that provides comprehensive benefits covering all types of care, including at-home or adult day care, care in an assisted living facility or nursing home. Benefits should be available for the care that is most appropriate for the individual’s long-term needs.
Choosing the right policy
A long term care policy should be adequate to cover the potential need, considering the daily amount and how long benefits may need to be paid. As with any type of insurance, the purpose of long term care protection is to safeguard individuals and their assets against catastrophe. Therefore, while the average length of a stay in a nursing home is only almost 2 1/2 years, when we consider only those nursing home stays that are for chronic conditions (those lasting more than one year) then the average length of the stay is more than 6 years. That makes a policy with unlimited, lifetime benefits the most desirable.
Your long term care policy should also provide protection against inflation. Individuals should think about those benefits that might need to be available in 10, 20 or even 30 years. It is also important to estimate what the medical costs could be in the future to insure you have adequate coverage.
