Every issue, we ask readers on social media and in our weekly newsletter to share their thoughts about a specific topic. This time we’re talking about long-term care.
Q: How do you currently pay for long-term care, or how do you plan to afford it for yourself or a loved one in the future?
I do not pay for long-term care insurance for the following reasons:
1. I find it difficult to understand and to source accurate information.
2. I perceive that it pays for much less than what people think they are paying for.
3. I perceive that many insurers have gone out of business, that it is an unstable industry.
4. It is unclear to me how one policy carries over from one state to another (assuming I buy it while living in State “A” and later move to State “B.”)
5. I perceive that the premiums tend to increase for unclear (uncontrollable) reasons. Your previous investments are a sunk cost… you are stuck just paying more and more with no recourse in order to (hopefully) receive some future benefit.
Sadly, I swim in a world of urban myths with few “hard facts” about long-term care insurance. My best plan is to just not run out of money (aka budget) and pay for future needs as they arise. — Anonymous, via email
My employer offers long-term care insurance as an extra benefit. — Nancy Rainwater, of the Alzheimer’s Association
We do not have long-term care insurance. It is EXTREMELY expensive. It is better to apply for it the younger you are; the price is less. — Margie Brandt, Vernon Hills
I am single and do not have any children, so on my 50th birthday, I gave myself the gift of a long-term care (LTC) plan.
I worked with my financial advisor to identify a plan I can afford by:
• Starting as early as possible that makes sense to me (e.g. at 50 years old). The rates are cheaper when you start younger.
• Choosing a plan amount benefit I can afford (e.g. $2,500 monthly vs. $4,000, monthly) that would “supplement” my retirement funds so I won’t wipe out my entire savings.
• Choosing a plan with a longer elimination period (e.g. 3 vs. 6 months).
• Choosing a plan with a smaller (monthly) amount benefit with a prolonged benefit period (e.g. choosing $2,500 monthly for 6 years vs. $4,000 monthly for 3 years).
• Choosing a plan with an optional benefit of additional purchase benefit, meaning one can buy more coverage at certain ages regardless of the insured’s health and when the insured has certain life events like getting married or having children.
• Choosing to pay monthly premiums as opposed to annual, semi-annual or quarterly, to make it more affordable.
When I am reminded that my LTC plan covers 100% of nursing home care, 100% home health care, 100% assisted living facility care with a lifetime caregiver training benefit of $500 (total amount), I know that I finally bought my “peace of mind” in my retirement years. — Bernadette Molina, via email
I bought LTC insurance for my wife and me from State Farm a couple decades ago, and periodically was tempted to drop the policy as the premium rose and rose. I kept the policy affordable by reducing the daily benefit. When my wife needed LTC, the policy paid 80% of covered expenses, which left me with a $2,000 monthly gap that I made up with IRA savings. — Dan Miller, via social media
I leverage the benefits and programs offered through my employer to plan for the future. — Beth Comer, Westlake, Ohio
Most people will need to pay from multiple sources. I have long-term care insurance but expect to supplement with savings. — Karen Purze, via social media
“I married a certified nursing assistant. We built a single story house with seniors in mind.” — Trey Littlejohns, via social media