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Do I Need A Long-Term Care Insurance?

As we all age, we have to start thinking about retirement and long-term care insurance. These topics might not be the most interesting, but they are things that need discussion before problems arrive. If not, financial problems will arise


A Fitting Example

One example that speaks to this was a couple based in Auburn, Alabama. The woman wanted to get long-term care insurance, while the man wanted to set aside investments to cover for any care. For two 70-year-olds, this conversation was difficult, and there was a lot of disagreement. This example is not only for these two people but for a lot of seniors around the world.

Do I Need A Long-Term Care Insurance?

Alternative Options

Long-term care is not for everyone. If that is the case for you, then you might want to try something else. There are some people out there taking out life insurance rather than long-term care. With the lifetime cost of long-term care being quite expensive, some take the bet that they will die before the number hits $172,000. In turn, the money is given to the family once they have passed.

If you are a person that wants to build a legacy, this example might be the road for your journey. With the cost of nursing homes and in-home care, this policy looks pretty good. Especially when premiums double over six years, things can look bleak when it comes to money. Decide what is best for you and your family, and that decision will make all the difference.


Medicaid’s Involvement

Even with disagreement, half of the people will need to have this type of insurance during their lifetime. Now, wealthy people who have assets between $2 and $3 million can afford this insurance, and so can low-income individuals who receive Medicaid to pay the bills, but people who are neither low-income nor high-income get into a tricky situation. So, does Medicaid pays for long-term care? Yes, it does, to a point.

Do I Need A Long-Term Care Insurance?

The Cost of Insurance

So, how much does long-term care insurance cost? With the average cost of this insurance at around $172,000, many people go broked with or without the insurance. In turn, no money goes to the children. This cost of insurance would mean some high premiums, but there would be a high chance of the finances paying out. Still, insurers do have a cap on the money they will give to policyholders.


Long-Term Care History

Long-term care came about in the 1980s. At the time, this care was super cheap and much more generous in the benefits. But, ultimately, the coverage was underpriced, and as time has progressed, the cost has gone up and up.

In today’s day and age, this insurance is very restricted. Hopefully, premium increases will not happen in the future. This way, insurance companies will still be in business. Currently, there are elimination periods between 30-90 days. There is a chance that people can get coverage between $4,000-$6,000 every month. But, inflation will rise 3% every year. Over time, people may get out after three to four years, once they have the coverage ready and available.

Do I Need A Long-Term Care Insurance?

For How Long Women Stay In This Type Of Care Compared To Men

Currently, women stay in this type of care for almost three and a half years, while men leave in less at two and a half years. Even after the questions of “Does Medicaid pay for long-term care?” and “How Much Does Long-Term Care Insurance Cost?” it is still hard to make an educated decision on the topic.

Ultimately, long-term insurance is for the short-term of life. About 6% of people end up paying more than $500,000 for these services. You have to do your best to make a decision that is best for you and your family. In the end, you will have peace of mind whatever you do, so you can have the best remaining years in front of you and prepare your family for life after you leave this Earth.


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