Funding for eventual long term care must be planned for far in advance, and long term care insurance seems to be the tool of choice. The alternatives really suck by comparison, so it's time to get going to put your plan in place while you still can.
Fact is, there is nearly a 50% chance that during retirement, due to medical conditions or extended longevity, a person will eventually end up requiring 24-hour skilled nursing care in a long term care facility.
Another astounding fact is that more than 40% of nursing home residents are under age 65. In truth, at age 57, due to advanced Multiple Sclerosis, I myself would be in a care home if my wife would let me out of her sight.
And now let's look at the average length of facility care plus the projected costs for that care?
Long Term Care - It's Leading Causes & Average Lengths of Nursing Home Stays ( from Financial Planning News ):
What happens if you don't have long term care insurance, but you do need this long term care?
Well, at room rates of $300.00 per day, if care costs inflate at least 5% annually, then 10 years from now, the average, Alzheimer's, long term care stay in a private room could cost a family over $1,400,000.00+
Do you want your family to pay THAT out of savings? I don't think so, and long term care insurance is clearly the only sensible answer, but is long term care insurance too expensive?
Long term care insurance can cost from under $100/mo. to over $1000/month, so sure, at first insurance can seem expensive, yet consider this:
At 5% annual compounded inflation, in 10 years, actual real-life care costs could mount to well over anything you might ever put into long term care insurance. Just do the math.
The annual long term care insurance premium investment is often less than the actual cost of just ONE MONTH in a care situation.
NOTE: Recent industry articles indicate that long term care insurance is such a valuable planning tool that financial advisors may face legal action if they neglect to at least recommend consideration of coverage. (Trusts & Estates Magazine)
Long term care insurance may make good financial sense for you and yours, and the early bird gets the worm, because the lowest long term care insurance prices are locked in at the younger ages and are designed to remain level thereafter.
In any case, each policy is designed to custom fit your circumstances, so you have to work with a trained long term care insurance specialist in order to create the optimal coverage plan. You'll want a multi-company broker who can compare companies and policies to find the best long term care insurance plan for your unique situation.
Copyright (c) 2006 Clay Cotton
While thinking of long term care and what it may cost to purchase insurance, it may be good to think about looking into a long term care group, one that specializes in providing long term care insurance. By dealing with a company that only provides one kind of insurance, you are assured that you get the best possible coverage at the lowest rate possible. It is difficult enough to think of the possibility that you will need long term care, let alone to have to worry about purchasing the right long term care insurance to meet your needs.
OIC Long Term Insurance is a carrier that does nothing but write policies for long term care insurance. As a long term care insurance group, OIC is more likely to know all of the industry standards and costs and be able to provide you with the lowest possible rate. That doesn't mean that you shouldn't check with your regular insurance carrier because they might possibly be able to provide a better quote, especially if you have dealt with them for a number of years.
The important thing to consider with a long-term care group is having someone who knows the answer to your questions or is able to find out in a timely manner. Purchasing long term care insurance is a big decision, and unlike health or life insurance, it's not something about which everyone is knowledgeable. The concept is fairly new compared to health, car, and life insurance, so not everyone has al the answers to questions that a potential policyholder might have. For that reason alone, it may be a good idea to speak with several different insurance agents since some may be more knowledgeable than others.
When working with an insurance group or one that at least has a group of agents experienced in long term care insurance, compare the information that you receive from different ones, and if it differs, that might be a red flag that someone is really not as knowledgeable as you think they are. The time to find out is before you purchase the policy, not afterwards, and certainly before you need the benefits. Ask to see a copy of their long term insurance policy and read it all the way through to make sure it has exactly what you need and are expecting. If the information is different from what you have been told, you are then able to ask questions and ascertain just what coverage is being offered at the price you have been quoted. If it's not in writing, there is nothing you can do about it later. Be certain that everything you want is there in the beginning. Use the reviewing period to read over everything before you make a final decision.
Both Clay Cotton & Jim Johnson are contributors for EditorialToday. The above articles have been edited for relevancy and timeliness. All write-ups, reviews, tips and guides published by EditorialToday.com and its partners or affiliates are for informational purposes only. They should not be used for any legal or any other type of advice. We do not endorse any author, contributor, writer or article posted by our team.
Clay Cotton has sinced written about articles on various topics from Insurance, Parental Care and Health. Long term care insurance activist, Clay Cotton, writes for - The Online Baby Boomers Decisi. Clay Cotton's top article generates over 6600 views. to your Favourites.