Presented by the MEMBERS Financial Services Program* at SLFCU
Seventy percent of people turning 65 can expect to use some form of long-term care during their lives – such as services that can help them cope with extended illnesses, disabilities, or cognitive problems.1 As you get older, it’s important to think about your potential needs and whether long-term care insurance is right for you or a loved one.
Consider these numbers: The average cost of a year’s care in a private Medicare-certified nursing home room is $100,375,2 in-home care costs an average of $50,336 each year for 44 hours of help per week,2 and a year in an assisted living care facility averages $48,000.2 Long-term care is typically not covered by health insurance or Medicare, so long-term care insurance can offset the potential burden of getting needed services. If you fall into a low enough income or asset bracket in retirement, you may qualify to have Medicaid pay for your long-term care.
In some very important ways, long-term care insurance is different than other types of insurance. The following are potential advantages and disadvantages to consider.
- A long-term care insurance policy can cover a variety of potential needs, including nursing home care, assisted living, in-home care, hospice, and more.
- Having coverage can prevent a potential financial burden for family members, help protect assets you may want to pass on to your heirs, and offer greater flexibility in determining care providers than Medicaid could.
- Policies can be expensive, with premiums often topping $2,500 per year. Over time, your rates may increase and terms can change.
- You can be denied coverage based on a pre-existing condition or poor health. Some insurance purchasers have had to fight to get benefits after being denied based on the fine print details of their policy.
- The average period a person receives benefits from a long-term policy is about three years. You may pay for care you don’t use.
- Paying money into an investment account instead of buying a policy gives you more flexibility with how you can spend your money in your later years.
- If you own a home, you can hold its equity in reserve instead of paying into a long-term policy.
- You may be able to buy a long-term care policy through your employer at reasonable rates.
- If you are over 40, you may be able to deduct premiums as medical expenses at tax time.
A QUALIFIED FINANCIAL PROFESSIONAL CAN HELP.
If you’re 40 or older, it’s time to start thinking about your plan for long-term care. Whether or not this means buying a long-term care policy is up to you, but it’s wise to start earmarking money for the approach you choose.
SLFCU members can turn to the professional financial advisors at MEMBERS Financial Services* for help in determining their best approach. Learn more at slfcu.org/Retirement.
Contact a MEMBERS Financial advisor to make a no-cost, no-obligation appointment at an SLFCU branch near you. To schedule an appointment at the Cottonwood, Juan Tabo, Los Lunas, Paseo, or Rio Rancho branch, please call 505.237.3930. To schedule an appointment at the Edgewood, Kirtland, Livermore, or Tech Park branch, please call 505.237.7330.
* Securities sold, advisory services offered through CUNA Brokerage Services, Inc. (CBSI), member FINRA/SIPC, a registered broker/dealer and investment advisor. CBSI is under contract with the financial institution to make securities available to members. Not NCUA/NCUSIF/FDIC insured, May Lose Value, No Financial Institution Guarantee. Not a deposit of any financial institution. CUNA Brokerage Services, Inc., is a registered broker/dealer in all fifty states of the United States of America. FR-2741242.1-0919-1021
1. US Department of Health and Human Services, 2017.
2. Genworth Cost of Care Survey, 2018.
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