You’ve worked hard to build your wealth for retirement, and it’s important to protect it from unexpected expenses. But it’s also wise to plan for the possibility that you may need long-term care later in life. Careful consideration of costs, options for covering them and insurance policy features can help you decide whether a long-term care policy makes sense for your situation.
Most states have a program that allows people to buy private long-term care insurance at an affordable rate. New York state offers HIICAP Health Insurance Information, Counseling and Advocacy Program, a free, nonprofit organization that provides information and guidance in choosing the best long-term care coverage for your individual needs. HIICAP counselors can answer questions about the cost, coverage and comparisons of Medicare, Medicaid and private long-term care policies in your area.
In general, long-term care insurance reimburses a certain amount of your daily costs of long-term care, up to the maximum payout allowed by your policy. Some policies include an option to adjust the benefits annually for inflation. A knowledgeable long-term care insurance agent should be able to provide you with quotes from several companies for policies that meet your individual financial and health status requirements.
It’s often recommended that you shop for a policy while you’re still working, between ages 55 and 65. This is a time when you’re more likely to qualify, and premium costs tend to be lower than they will be later in life. But buying too soon can cause you to divert money from other financial priorities such as investing in your retirement account or paying for children’s college tuition.
Depending on your personal Go to the source circumstances, you may want to consider a hybrid plan that combines life and long-term care insurance coverage. Some insurers offer flexible, affordable combinations of the two that give you both protection against the high cost of long-term care and an opportunity to grow some of your assets.
Some people choose to self-fund their care, relying on family and friends for assistance. But that’s not always feasible, and it can put undue stress on loved ones. Many people buy long-term care insurance to help them pay for care without depleting their savings or putting a burden on family and friends.
Using your assets to pay for care can be financially, physically and emotionally stressful. But if you purchase a long-term care insurance policy and use it, you can keep a portion of your savings for your family and leave a legacy for your descendants. That’s the real value of a well-thought-out long-term care coverage decision.