Preparing for your retirement years can be a daunting task. Securing your income stream, updating estate planning documents, deciding where to live, and protecting assets you would like to leave to your family are all important actions to complete.

In addition to these, a plan on how to handle a long-term care event should be included on this list. It is estimated that 70% of those aged 65 or older will have long-term care needs during their retirement years. No other event can disrupt a retirement plan more than a long-term care event when no assets have been set aside to deal with this.

Those who have experienced a parent or family member needing either home health care or time in an assisted living facility know that costs can vary widely, but in every case, the costs add up quickly. In the event that a stay in a senior care facility is needed, they will expect to be paid and they have the right to gain access to assets that may have been set aside for other purposes.

Long-term care insurance may be a good way to help protect your assets and estate from such a situation.

Long-term care insurance policies have evolved over the years. At one time, the market was dominated by policies that we described as “use it or lose it”. In other words, the policyholders would pay premiums each year, often having to accept increases in premiums, until the time came that the policy was needed. But, in the event the policyholder never experienced a long-term care event, the pool of money created within the policy was never accessed. All premium dollars thus ended up in the hands of the insurance company.

Today’s long-term care insurance market is much different. Modern policies offer guarantees to the policyholder and their family that the funds will be used by the family in one form or another and guarantees that pricing will have a set structure. Many of today’s policies:

  • Guarantee a level premium for a set period of years.
  • Guarantee the pool of money that will be available for long-term care if needed.
  • Guarantee a death benefit to be provided to the family if long-term care is not needed.
  • Guarantee that the funds can be recouped if the policyholder decides to cancel the policy.

Funding a long-term care policy should be viewed as a repositioning of a portion of your assets to protect the rest of the assets in the event a home health care or facility care is needed down the road.

Do not let your retirement plan be derailed by a costly long-term care event. If you are in the process of planning for your retirement, call us about your long-term care insurance options today at 844-GANNONS.

Authored By:

Matt Tavani
Matt TavaniRegional Sales Director. Life & Financial Specialist