Have You Thought About Long-Term Care Insurance?

by Miranda Marquit · 0 comments

Not too long ago, an elderly relative of mine passed away. For the last couple of months, she was in need of constant care, and so was placed in a nursing home where her needs could be met. The costs of such nursing facilities, especially one as nice as the one my relative was placed in (small, with a private, home-like room), can start to add up quickly.

One of the reasons my relative was able to spend time in comfort without adding to the financial burdens of her husband was due to the fact that they had purchased long-term care insurance.

Will You Need Long-Term Care Insurance?

The realities of life today are starting to catch up with many of us. First of all, we are living much longer. It’s probably not unexpected for someone my age to live into my 90s — and perhaps beyond. This longevity means that it might be necessary to have the resources to live for more than 30 years beyond retirement. As a result of this reality, it is estimated that most people will spend at least some time in a long-term care facility, such as assisted living and/or a nursing home.

Chances are that you will need long-term care at some point in your life. Will you have the financial resources to cover this care?

For those who are unsure that they want to watch their money dribble away in a facility, or for those who want to make sure that they can afford to stay in a facility that meets their expectations and ideas of comfort, it can make sense to purchase long-term care insurance. This insurance is designed to pay for long-term care. You make your premium payments based on a daily payout (there might be a lifetime payout cap), and then, when you are in a facility, the insurance covers the cost so that you don’t have to deplete your nest egg.

Pitfalls of Long-Term Care Insurance

It’s important to watch out for the pitfalls of long-term care insurance, however. Not all policies are created equal, and you need to make sure that you are getting the best policy for your needs. Watch out for caps on coverage and payouts, and be aware of what types of facilities the coverage will allow. Some policies will pay for high-end facilities, while others will not. Make sure that you understand the policy provisions before you sign your name and begin paying premiums.

You can get the help of a financial planner as you choose your long-term care insurance as well. Choose a financial professional who isn’t getting paid based on a commission paid for recommending certain policies. You want to make sure that your policy options are evaluated on a basis that is fully in your favor.

With the right long-term care policy, you can save money — for yourself and for your family. I know that the long-term care policy brought peace of mind to my relatives, and was a great help during a difficult time. It made focusing on the needs of my relative possible, rather than adding money worries to the situation.

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