When was the last time you thought about long-term care insurance? Never? If it crossed your mind did you quickly dismiss it because it’s very expensive? Or because you don’t want to pay for something you probably won’t need?
Most people don’t think about purchasing long-term care insurance… until they’re in a situation where they do need it. And that’s much more common than you’d think.
Speaking from personal experience, you want to have it in place well before that.
I got injured in my house while I was cleaning my kitchen (really!) and have spent the last 4 months completely unable to take care of myself. This experience has impacted me in many ways, including reawakening extreme financial anxiety.
It’s also taught me a lot about what it’s like to be disabled in America. So, I’m sharing some of these experiences, in hopes they help you if you ever get into a similar situation. And I really hope you don’t… but the odds are that you will at some point
Here are 5 reasons to invest in long-term care insurance now:
Reason #1: Chances Are You Are Going to Be Temporarily Disabled at Some Point In Your Future
Seriously, this could happen to practically everyone at some point. Period, end of story.
The older you get, the higher the chance of that happening rises every year.
No one expects this to happen to them. I definitely didn’t. Yet here I am, flat on my back, surrounded by professional caregivers because I am literally incapable of even changing my shirt by myself at the moment.
It’s a scary situation to be in. It’s even worse if you have no idea how you’re going to pay for the care you will absolutely need.
Reason #2: The Low Qualification Threshold for Benefits Under Most Long-Term Care Policies
The only thing you need to qualify for benefits under most long-term care policies is to be unable to do at least two of six things considered “activities of daily living” or ADLs.
The activities of daily living are:
- Caring for incontinence
- Dressing yourself
- Feeding yourself
- Getting on or off the toilet
- Getting in or out of a chair
So, if you hurt your shoulder and you can’t make yourself food or feed yourself…
If you can’t be by yourself because you can’t get out of bed on your own…
If you can’t change your shirt by yourself…
Any two of those things count to qualify you for long-term care benefits.
Reason #3: Disability Isn’t Just for Old People
As much as we all deny it, none of us are invincible.
And the world is out to get you, whether you recognize it or not.
You can get hit by a car.
You could get sick with a chronic illness like cancer or early-onset Alzheimer’s.
You can have Long COVID.
You your own house and get seriously injured, like I did.
There are dozens of things that can render you disabled to the point where you can’t take care of yourself permanently or temporarily.
And long-term care insurance will help you cover the costs of the care you need because that care is insanely expensive.
The medical system in this country is broken. You will not get the care you need unless you can afford to pay for it. And the last thing you want is to be in a situation where you lose everything you’ve worked for because of a debilitating health issue, whether it’s a temporary or permanent situation.
Reason #4: No Other Type of Insurance Covers the Cost of Care
Disability Insurance replaces 60 – 70% of your wages prior to your claim.
Health insurance covers medical care and some home care if you get a prescription plan from your doctor for it.
Regular care like someone helping you bathe, helping you eat, and getting you dressed, and things like that are only covered by long-term care insurance.
And those are the things you’re really going to need, believe me.
If you don’t have coverage for them, you’ll have to pay out of pocket and that can take a big chunk out of your savings or retirement funds, if you even have those to begin with.
According to Genworth’s 2020 Cost of Care Survey, the annual median cost of Homemaker Services was $53,772. And that number is – in my experience – ridiculously low. I have an excellent home care team 24/7… and it costs about $4,200/week… which converts to $218,400 per year.
That’s a more than a year’s salary for many people.
Reason #5: The Cost Of Care Whether You’re In a Facility or In Your Home Is Astronomical.
As I just mentioned, 24/7 homecare is running around $4,200 a week for me. Yes, you read that correctly, $4,200 a week.
And if you think that’s ridiculous, it’s not over-priced at all. These people are taking care of you. They work hard and they’re with you all the time. You’ll need that to survive. But the truth is, it costs a lot of money.
The only way to help balance that out without completely destroying your entire nest egg is to have at least some reimbursement from long term care insurance.
I won’t lie. I am definitely burning through my own nest egg and I have long-term care insurance.
This experience has really opened my eyes to the huge costs of being disabled. I’m lucky that my disability is expected to be temporary, but four months still feels like a really long time. And I don’t expect to be fully back to myself for quite a while.
Knowing that this insurance is there to at least offset some of the costs helps relieve a lot of the financial anxiety I’ve been feeling. It also makes me realize that there is hope that I will have some money left when I’m through this so I can actually live my life when I have a good quality of life again.
Yes, Long-Term Care Insurance is Expensive But It’s Worth It
If you don’t have long term care insurance, get it while you’re young.
According to this article on NerdWallet, a single, healthy, 55-year-old man getting new coverage can expect to pay an average of $1,700 a year for his policy.
A single, healthy, 55-year-old woman can expect to pay an average of $2,675 for her policy. The difference in cost is because women live longer and we’re more likely to use the policy. Because, unfortunately, women are more likely to get disabled than men – about 25% of us suffer at least a temporary disability every year.
Average premiums for a married couple would be $3,050.
Yep, that sounds really expensive. But take it from me, it’s worth it.
And yes, rates can go up over time but your rates will be lower the younger and healthier you are. And disability can happen at any time.
There are also potential tax advantages to buying long-term care insurance. You can deduct part or all of long-term care insurance premiums as medical expenses on your Federal taxes and some state taxes if they meet a certain threshold.
Plus, there’s the whole “peace of mind” factor. Once it’s in place, you can rest easier, knowing if disaster strikes, you’ll have something to fall back on.
And disaster can strike at any time.
My accident happened in my house. It was totally unexpected and I’ve been literally flat on my back for four months. It has been worth every penny I’ve spent to have professionals caring for me 24/7. I don’t have to rely on my family to do it and I know I’ll be reimbursed for at least part of the expense.
What happened to me could have happened to anyone and it can happen to you. So please protect yourself and your financial future. I know it seems expensive but the cost of long-term care insurance is a tiny percentage of the cost of full-time medical care.
Worried That You Won’t Be Able to Afford the Premium Payments for Long-Term Care Insurance?
You may have hidden expenses you’re paying right now that would cover the cost of your premium payments if you eliminated them.
These are expenses that you’re paying regularly but may not even realize this money is slipping out of your bank account each month.
The best part? You can uncover these hidden expenses easily and get that money back!
Whether you use it to cover the cost of long-term care insurance or you just have it sitting in your account, or your pocket, it’s your money. You should be the one in control of it, not these companies siphoning it off.
Use my Find Hidden Expenses Checklist to discover whether you’re letting money trickle away on memberships you don’t use anymore or subscriptions you’ve totally forgotten about.
Click on the button below to get your copy now.