About 70% of older adults will need some kind of long-term care at some point. This type of care could include a nursing home or various degrees of home care, whether it includes skilled nursing care, assistance with activities of daily living, or some combination of services.
The problem is, these services are very expensive, and the costs are not covered by Medicare, outside of a 100-day period in which skilled nursing care is covered for those who qualify and non-medical care is not covered.
Medicaid covers some costs for long-term care, but the income requirements to qualify for Medicaid assistance are very strict. It’s not uncommon for older adults to spend everything in their care to qualify, so when they do, they are close to homeless.
This can be prevented with an LTC insurance policy. But these policies come with their own challenges, and not all are good candidates. Here’s an overview of when you should (and shouldn’t) consider long-term care insurance.
If you have assets to protect. If you have important assets, such as a valuable home or a savings account, that you want to protect and leave your family behind, you may want to buy LTC insurance. If you can afford it, this type of insurance will cover your long-term care without requiring you to “spend” to meet strict income requirements.
If you have a health history that suggests you need it. Long-term care policies can be expensive on their own and sometimes include significant out-of-pocket costs. Basically, you risk that one day you will need long-term care. However, if you have a history of health problems in your family that normally require this type of care, such as dementia, diabetes, or cardiovascular disease, you are more likely to need it yourself.
If you have no relatives to trust. If you don’t have close family members who can take care of you, then purchasing long-term care insurance may be a better option. That said, it is possible that even if you have a family member ready and willing to take care of you, he or she will not be able to provide the kind of care you need as your situation, or your future finances or work progresses. carer. The situation will change and it will make caring for you one less option. Regardless of whether you have family members who can care for you, and you should discuss this with them first, it is important to take the necessary steps to prepare for your future.
If you can afford it. Long-term care is expensive. In general, you should consider long-term care insurance only if you have at least $ 75,000 in assets, excluding your car and home, and an annual income of at least $ 35,000 per year (although this may vary by state) based on United Seniors Cooperativa de Salud. Premiums can also go up significantly, so you’ll need to make sure you can afford them comfortably without making huge sacrifices.
Because of the cost, making the decision to buy long-term care insurance is never easy. But for many older people, it can be crucial. Do some research on your options, and hopefully you can make the best decision for your situation.