With people living longer, odds are that many of us will become disabled for some time before we pass away and will need some long-term care. The estimates are at least 70% of Americans over age 65 will be impacted, and the majority underestimate the cost.
The Memphis Daily News article, “Long-Term Care – Not for Everyone,” says that Medicare does little for these costs and only for a short time period. Medicaid doesn’t apply until the assets of an estate are spent down, so many people must pay for these costs out-of-pocket. The article says that there are only two ways to address these expenses: with your investment/retirement portfolio and with long-term care insurance. Most people review the cost of long-term care insurance and elect to roll the dice, but when that first round of expenses hits, they probably will wish they’d bought it long ago. Now it’s usually too late to buy it. If you can afford to self-insure, you can save your estate and yourself some serious money.
Long-term care insurance as part of your overall retirement plan is an option you should consider sooner if you don’t have other options to cover the expense. And if passing on an estate to your heirs is important to you, then shifting some of the risk to insurance makes sense. The best time to start looking at coverage is age 55. If you wait beyond that, you may see higher premiums and an increased possibility of being denied coverage.
Talking with a qualified estate planning attorney can help you discover a solution that works best for your individual situation.
Of course, active aging is great, but with age can come injury or illness, so you should look at your options. If you rely on family for long-term care, it can take a huge toll on the caregivers—both emotionally and physically—while the adult children also help to manage their own households.
If you do go this route, be certain to discuss it with all family members. You should also investigate other sources of help, such as adult daycare and hired aid. Caregiving can be physically and financially draining. It may lead to hard feelings and broken relationships in the family. Consider all of the emotional costs as well as the financial costs before making your decision.
Reference: Memphis Daily News (July 29, 2016) “Long-Term Care – Not for Everyone”