Long-term care planning is an absolute necessity for all Americans. And contrary to popular belief, you do not have to wait until you are retiring to plan for it. Many Americans often make the mistake of delaying planning for long-term care because they think that they still have a few more decades to spare. Why pay for something you will not need for another 30 years, right? “We might not even need it,” as many would say.
However, this type of thinking has severe repercussion not just on you but on the people around you, as well. Because of the lack of planning, so many families are struggling to keep up with the care costs of one member. Children have assumed the roles of family caregivers for their aging parents. Many of them have to give up jobs and dip into their own financial pools in order to help with the costs. Older individuals have had to tap into their retirement funds just to keep up with the prices.
Long-Term Care Is Not Just For The Old
It is true that the majority of care recipients are older individuals with illnesses and conditions associated with aging. In fact, studies show that 70% of people turning 65 can expect the need for long-term care to arise in the next few years.
However, this type of coverage is not exclusive to the aging. About 40% of long-term care recipients are younger than 65. Moreover, individuals age 35 and younger make up a big portion of this number. These are the people who require long-term care because of specific conditions and illnesses that hinder them from performing the activities of daily living.
The Price Tag on Care in the United States
The price of long-term care in the United States is high. Early this year, Genworth recently released 2016’s cost of care. At present, the average annual cost of staying at a nursing home is $82,125 for a semi-private room and $92,378 for a private room. A year’s stay in an assisted living facility will cost an individual $43,539. For adult day care services, the price tag is at $17,680 per year. Homemaker services and home health aide are at $45,760 and $46,332 respectively.
Understandably, paying out-of-pocket for these expenses—although not impossible—is a risky decision to make. For many people, it is not even an option, and this is why they look to other means to support their care.
Check out our map of the top 10 cheapest long term care in the United States.
Is Long Term Care Insurance Worth It?
Because of the recent price hikes in the long-term care insurance industry, many individuals have become hesitant in purchasing a policy. Especially with all of the horror stories and accounts published online, people are now looking at other measures and options.
However, a recent study surveying beneficiaries from 11 major long-term care insurance companies shows that 94% of the respondents say that their benefits are sufficient to meet their current care needs. The study also shares that 3 in 4 claimants believe that their long-term care insurance policies allowed access to higher-quality providers.
Consider the current care prices and the fact that 7 in 10 older individuals will need long-term care. With those odds, readily setting long-term care insurance aside without fully looking into it might not be a wise decision.
Also Read: Beginner’s Guide to Long Term Care Insurance
Long-Term Care Insurance From All Perspectives
Long-term care insurance policies, like most investments, are a risk. And similar to other investments, you would want to gain in-depth knowledge before deciding.
Admittedly, it is not a product for everyone. Long-term care insurance policies can cost a pretty penny. It can also take a turn for the worst without proper consideration and planning. But the substantial benefits and the peace of mind are there. You do get the best coverage that you can hope for in your time of need. This is why—as generic as it may sound—people are constantly reminded to do their research.
Study the product and match it with your needs and financial capabilities. Base it on your personal situation and standing because every person has his or her own unique situation. Do not forget to set a meeting with industry experts who can lead you into making a well-thought-out plan.
At the end of the day, it is your decision, so make it a good and an informed one. Long-term care insurance might not be the best option for other people, but it might be for you, so do not deny yourself the opportunity of securing a good future.
What’s Your Long-Term Care Story?
Long-term care planning is a unique and personal process. How did your planning go? Did you encounter any speed bumps along the way? What were the positive outcomes? And what is one piece of advice you wished you had known then? Share your experiences below!
One thought on “Dropping the Big Bucks: Is Long Term Care Insurance Worth It?”