Time to Take Care of Your Future: The ABCs of Long-Term Care Planning

You think it’s too early to talk about long-term care planning, don’t you? Guess what. It’s never too early. It can only be too late.

Most likely, when you think about planning for your financial future, you focus on saving money for a comfortable retirement. But what if you knew an unexpected health issue requiring your long-term care could wipe out your entire nest egg?

Think about it. You sacrifice and save for decades to be sure you have a secure retirement. You have a life-changing stroke at 57, or you’re hit with a Lewy Body dementia diagnosis at 63? In a few short years, it would take your entire retirement savings, and then some, for your long-term care.

The more you know about long-term care today, the smarter you can plan your future tomorrow.


Would you like to learn more about the long-term care insurance options available to you? Give me a call at 844 805 3557, and I’ll answer your questions and get you on the road to a confident retirement.


What Is Long-Term Care Insurance?

LTC insurance is created to help people, who can’t fully take care of themselves. It commonly covers the costs of four things (coverage depends on the policy):

  • Nursing home care
  • Assisted living care
  • At home assistance
  • Home modifications (installing ramps, grab bars)

It may also surprise you to know that people who need these services are not always older. Many young people take advantage of such insurance as well.

One rainy morning, my friend was riding his motorcycle to work. Another driver who didn’t see him, pulled into his lane from a side street at the last minute. Even though he was wearing a helmet, his injuries were catastrophic. He spent months in the hospital, followed by two more years receiving help. First, he was in a nursing home, and later he stayed home with home care assistance. He was 48.

Life is unpredictable.

Most people do use their long-term care insurance in their later years. It will cover the costs not included in health care. For instance, if you need someone to come to your home and help you cook or take a bath, long-term care insurance pays for that. It will also cover a senior day-care facility where you won’t just get physical assistance, but enjoy entertainment and socialization.  

None of these daily living expenses are covered by Medicare. Medicaid takes care of these services, but only for low-income seniors who qualify. If you are a war veteran, you also get these benefits for free.


Who Qualifies For Long-Term Care Insurance?

You have to understand that you can’t purchase long-term care insurance if you already need it. If you’re diagnosed with one of several pre-existing health conditions, or need assistance doing essential daily tasks, it’s too late.

You should also know that the younger you are when you buy an LTC insurance policy, the cheaper it will be. Like medical and life insurance, the cost goes up with age.

Once you’ve done your long-term care planning, and you’re the happy owner of an LTC insurance policy, now what? When can you use it? Qualifying for care is based on your inability to do what are called Activities of Daily Living (ADLs).

Activities of Daily Living include these six personal care tasks:

  • Dressing
  • Bathing
  • Eating
  • Toileting
  • Continence
  • Transference (moving from bed to chair, walking)

If you can’t perform two, or more of these activities, you can take advantage of your previously purchased policy. If you can’t perform two, or more of these, and you don’t already have LTC insurance, you can’t buy it. Just like you can’t buy fire insurance when a raging fire is racing toward your home.

Statistically, 70% of seniors will require some level of services covered by LTC insurance for physical or cognitive problems. The average period seniors need assistance covered by LTC insurance is three years. Although, some will require up to 15 years of care, and 30% will never need any care.

How Much Does Long-Term Care Insurance Cost?

Long-term care insurance is expensive. There’s no sense beating around the bush on this one. Long-term care insurance provides a set of expensive services for a long period of time. That’s why the policy doesn’t have an attractive price tag.

The cost of LTC insurance depends on your age. If you buy it before you’re 55 years old, it can cost about $2,000 per year. After you turn 60, the cost can be as high as $8,000 per year.

The long-term care insurance premiums vary depending on the number of services you want covered.

LTC insurance rates tend to go up once every few years with inflation. Pay attention to the terms of the policy you’re buying. Otherwise, you may be paying a flat rate for several years and then see a 50% rate hike.  

Each insurance company has its own rates and perks. It makes sense to study what each has to offer in terms of coverage, discounts, services, and advantages. Most companies offer some type of “good health” and “age” discounts. Some payout to heirs if you never use the insurance.

The major cost-deciding factors for long-term care insurance costs are:

  • Age
  • Gender
  • Health status


Pros and Cons of Long-Term Care Insurance

It seems like long-term care insurance has an obvious pro – increasing your future quality of life. It also has an obvious con – a high price tag. But, there’s much more to consider before making a decision.


  • Peace of mind. You don’t have to worry that you won’t have enough money to take care of yourself when you get older.
  • Better facilities. In most cases, LTC insurance allows you to afford better long-term care facilities than you would without it.
  • No extra saving. You don’t have to worry about saving money to pay for care facilities. After all, you never know how long you’ll need it. And it’s likely your savings wouldn’t be sufficient.
  • Fewer risks. Some people require long-term care when they’re still quite young. It’s unlikely you’d be able to save up enough money to cover the costs.



  • Rate hikes. The rate may increase substantially at any time due to factors you can’t influence.
  • Doubtful investment. If you know a little about investing your money, you may find a much better place to invest $3,000 per year and get sufficient returns to cover some long-term care costs, if they arise.
  • Not using it. Nobody knows for sure if they would ever need long-term care coverage. According to statistics, you have a 30% chance of not needing long-term care.
  • Expensive plans. When you choose a plan that suits you, it may turn out to be too expensive to afford.


Should You Buy Long-Term Care Insurance?

Do you think you’ll need the services LTC insurance covers? Nobody is ever 100% sure. Most young people believe that they will never live long enough to need it. And most older people who didn’t buy when they were younger can’t afford it.

Experts recommend that if the insurance premium is less than 5% of your income, then you should definitely consider buying it.

Long-term care insurance planning offers you peace of mind. Unless you’re sure you can pay for your long-term care another way (investments, help from relatives, the lottery), it’s a good idea.

These days, a new approach to long-term care insurance is attracting more people. Many insurance providers offer hybrid long-term care solutions that abandon the “use it, or lose it” concept of traditional LTC insurance.

Hybrid plans reduce the fear of wasting premium money by offering two exit strategies. They also include a death benefit, and a guaranteed amount of LTC coverage ensured by fixed cost premiums.

Simply complete the contact form on our website while you’re thinking about it. Or, you can call 844 805 3557 to start your long-term care planning, and pre-qualify over the phone.

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