Can You Really Afford Long-Term Care Insurance?

Americans are living longer than ever before. One of the concerns for many of our clients is the possibility of outliving their assets due to the need for long term care. Most people mistakenly believe that long-term care insurance is expensive and difficult to obtain. The American Association for Long-Term Care Insurance recently released a report on the costs of long-term care insurance, and the results were surprising.  According to the report, “over one-fourth [of buyers under the age of 61] paid less than $999-per-year.” And in fact, “fewer than one in 10 (9.3%) pay $3,500 or more.”

This is great news! This means that long-term care insurance could cost you less than $100 per month. The trick is that you have to think about it early. “Age at the time of application plays an important role in determining the cost for long-term care insurance the Association study reports. While 41.5 percent of buyers under age 61 pay between $500 and $1,499-per-year, only 20.8 percent of buyers who are ages 61-to-75 pay within this range.”

This however is not to imply that if you’re over the age of 75 you’re out of luck. Although you’re not likely to get the same great rates as someone in their 50’s, you still may not have to pay an arm and a leg for long-term care insurance. According to the report, of applicants aged 76 and older only 28.2% end up paying an annual premium of $4,000 a year or higher. Actually, almost half of applicants in this age range still end up paying less than $2,500 a year. This may not be the attractive $500/year you could have gotten in your 50’s, but it also isn’t the thousands of dollars a month most people seem to be afraid long-term care insurance is going to cost them. In fact, it’s a little over $200/month. If you weight the risk of nursing home expenses, long-term care insurance is a wonderful tool to manage that risk.

If you’ve been thinking about long-term care insurance, don’t wait any longer. This is one  situation where time is not on your side; the faster you act the better it will be. Give us a call and we’d be happy to recommend a professional who can assist you with long-term care insurance.