The Who, The What and The Ways of Planning for Long-Term Care.
Long-term care is the type of care that you may require one day if you do need support with simple everyday life activities. Planning for its expense now lets you afford quality care in the future and reduces the possibility of LTC costs that might drain your retirement savings.
The Who: Who covers long-term care?
Medicare only covers long-term care in limited circumstances. Such as a short stay in a skilled nursing facility after a hospitalization. It will pay for a maximum of 100 days. It does not cover long-term care if that’s the only type of care you need.
Medicaid will pay for some long-term care services, but your income and assets must be extremely low to qualify for Medicaid.
The Veterans Health Administration provides some long-term care services to individuals enrolled in its health care system.
The What: What are the chances that you’ll need long-term care?
Greater than you may think. Someone turning age 65 today has almost a 70% chance of needing some type of long-term care services and supports in their remaining years, according to the U.S. Department of Health and Human Services.
The Ways: Here are three ways to plan for long-term care expenses
Build up your savings. One way to prepare for the possibility that you may need long-term care one day is to save enough money to cover long-term care expenses on your own. The advantage of this approach is that if you do not need long-term care services, your heirs will eventually inherit the money you set aside for long-term care.
Purchase a traditional long-term care insurance policy. This type of insurance policy generally covers part of the cost of long-term care services received at home or in a nursing home, assisted living facility, or adult day services center.
Purchase a combination of long-term and life insurance. Combined coverage generally pays benefits for long-term care if you ever need it and a death benefit to your beneficiaries, reduced by any long-term care benefits you received.
Set up a no-obligation consultation and talk to our financial professionals about how to plan for the cost of long-term care.