You’ve worked hard to build a nest egg for your retirement years. The worrisome questions are, “Have I saved enough to cover expenses if I got really sick?” followed closely by “What isn’t covered by Medicare?”
“Many people assume that their savings will cover the costs of a nursing home, or that Medicare will pick up the tab,” said Brent Cooper, owner of Brent Cooper Insurance in Dallas. “Unfortunately, that’s just not the case. Medicare does not cover the cost of long-term care, and Medicaid is only available to the poor. That leaves millions of middle-class Americans at risk of losing their lifetime savings and selling their homes to pay for long-term care, possibly leaving a spouse or child with nothing.”
And it is a huge problem. According to recent studies, 70 percent of U.S. citizens who reach age 65 will need long-term care one day. This is an expensive proposition. Long-term care services can easily cost as much as $250 per day, which will quickly empty even a healthy bank account.
Long-term care insurance – a relatively new insurance product— fills a serious need for the aging American population. In addition, it provides peace-of-mind for families that they can retire and keep their assets intact if they get sick.
Long-term care insurance covers care that does not typically fall under the auspices of health insurance, Medicare or Medicaid. It helps pay for a wide range of services, depending upon the specific policy, such as home care, adult daycare, hospice care, nursing home care, assisted living and Alzheimer’s facilities. Some policies even assist with payments for companions, housekeepers, therapists and nurses.
“By purchasing long-term care insurance, you are buying options,” Cooper notes. “Without insurance, you are at the mercy of the state or your dwindling savings, meaning you might be put into a facility that is not up to the standards your family would expect. With long-term care insurance, you and your family can decide what is best for you – a high-quality long-term care facility, in-home care, assisted living or another option. Being able to stay in the comfort of your own home and choose your nurse or assistant is huge.”
The policy isn’t cheap and some financial advisors have suggested that annual premiums could simply be invested, which would then provide enough wealth over time to provide for long-term care. This, however, is a very risky strategy unless you are extremely wealthy.
According to the American Association for Long-Term Care Insurance, a couple at age 55 typically spends $2,700 per year to buy a shared policy with immediate benefits of $328,000. By age 80, that joint benefit has increased to $708,000, with built-in inflation protection.
“Imagine that you put $2,700 per year in a savings account in case you one day need long-term care. That $2,700 of savings could vanish in just a few weeks, should long-term care become necessary,” Cooper said. “Ten years of savings could be gone in less than six months.
In contrast, if you use that money and purchase a long-term care insurance policy, you will have peace of mind that you can afford the care you might need. Plus, your home and other assets will be protected for your spouse and other family members.”
People should consider purchasing a policy sooner rather than later as they may become uninsurable in the future, and buying at a younger age means locking in a lower premium.
Don’t risk everything that you have worked a lifetime to earn. Investigate a long-term care policy today. Contact Brent Cooper today at 214.731.4884 to arrange for a free consultation.
Serving the Insurance needs of the Dallas Neighborhoods of University Park, Highland Park, Lake Highlands, Preston Hollow, Oakcliff, and Coppell.