Planning for Long-Term Care

It’s unfortunate that most Americans make their retirement plans without considering long-term care. LTC expenses can significantly reduce the savings and assets you’ve built up in your career or business, endangering your family’s lifestyle and security. For a complete retirement plan, make sure that you have an answer ready should you require long-term care in the future.


Ways You Can Pay for Long-Term Care

Here are the main ways you can pay for LTC expenses:


Self-insuring means paying costs out-of-pocket, or using your savings and assets. Most individuals who do not plan for long-term care are only self-insured, and will have to shoulder their expenses without assistance. While this may be sufficient for the few who have acquired enough wealth, majority would be middle-income families who will have trouble absorbing its financial impact.


Medicare only provides very limited coverage for LTC services. Specifically, Medicare can pay for a short stay (up to 100 days) in a nursing home after being hospitalized for at least three days. Some medically necessary services are also covered such as physical therapy, medical social services and medical supplies and equipment.


Medicaid can pay for most long-term care services; however, your total assets will need to be below a certain level for you to be eligible. This joint federal and state program is targeted at helping people with low income and assets, and as such, is not really a good plan if you’re looking to protect your retirement savings.

Long-term care insurance

Long-term care insurance is expressly designed to pay for LTC. By paying premiums while you’re younger, you gain a greater amount of benefits that you can use later on when you need it. Policies with inflation protection also allow your benefits to grow with time so it can keep up with the climbing rates of services.


There are a few other financial products or methods that could help you pay for long-term care:

  • Life insurance with a LTC rider combines two distinct benefits into one policy. Whether or not you’ll need long-term care, you can be guaranteed that you or your family will receive benefits.
  • Annuities with LTC benefits also allow you to make early withdrawals while it grows. The remaining benefits will then become a steady stream of income after a certain age.
  • Reverse mortgage lets you borrow from your home’s equity, which you can then use for any purpose.


Need Help with Planning?

Successfully planning for long-term care entails an examination of your current financial resources and taking steps towards methods that will help you for future needs. Because much depends on your personal circumstances, each individual’s long-term care plan is unique, and you will have to find the best way to prepare.

We can assist you in creating a plan that protects your family against the impact of long-term care. Learn about your options and receive expert help through our Free Quote page.

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