If you are 60 or older consider buying-long term care insurance to cover in-home care or nursing home care. The average nursing home stay costs $76,000 per year, which will crack and scramble a nest egg in a heartbeat. Dad in the nursing home can use up mom’s $250,000 savings in just a few short years.
Using long-term care insurance to insure your retirement makes sense. You insure your car against damage, your home against fire, and you purchase life insurance, so why not insure what can be the largest and most devastating risk to you and your family? Unlike other risks you insure against, the need for long-term care is the most likely to happen. Long-term care insurance also will help you keep your independence and dignity, and allow you to make choices about where you want to spend your final years.
Here are some specific reasons for buying Long-Term Care insurance:
- If you are married and need long-term care, your spouse will be able to pay for an outside caregiver and receive needed rest and respite.
- If your children promise to take care of you, then when the time comes that you need care, insurance will help them by paying for aides to assist with tasks of daily living.
- If you are single and need long-term care but you have no family to help you, insurance can pay for and coordinate that care.
- If you intend to leave assets behind when you die, insurance will help preserve those assets from the cost of long-term care.
Consider buying long-term care insurance at a younger age. The advantage of doing this is a lower premium.
For example, a person, currently age 45, buying a typical policy with a spouse, could spend $21,146 in total premiums to age 78.
If this same person chooses to wait to buy the equivalent coverage at age 65, it would cost the couple $52,566 in total premiums during the 13 remaining years to age 78. By waiting, they would pay 2 ½ times more for the same policy.
Additionally, health qualifications will be stricter and health problems related to aging may disqualify a person from obtaining a policy.
