Having a conversation to think through long term care needs helps you evaluate how a loved one’s long term care needs may impact their or your financial security. Almost 40% of people believe they will need long term care, yet most people don’t take action until something happens. This puts you at a disadvantage due to a pre-existing condition and may cause family members to make spur of the moment, emotional and uninformed decisions. Having honest conversations can reduce stress and allow everyone to make decisions more comfortable later.
What would you do if you received a call today regarding a family member who required immediate long term care assistance? 73% of people cannot answer that question. If you as an adult child have these concerns on your mind, chances are your parents do too. Most people are five times more concerned about being a burden to their family than they are of dying. Seniors want to be able to afford quality care in a setting they chose as well as protect their spouse and loved one’s quality of life. One survey found the national median for a year of nursing home care to be $77,000 and the cost for an inhome licensed home health care aide to be $19.00 per hour.
Part of retirement strategy should include planning for long term care. What are your options?
Many people feel the government will pay for long term care expenses. Medicare generally covers a skilled nursing facility after a hospital stay of at least 3 days, for a limited amount of time. Medicaid contributes towards care but requires the savings you’ve worked hard for to be spent down.
You may look to family and friends to provide care. This decision may require moving closer to where these individuals live. Consideration must be given to whether they have the time, ability and physical and financial resources to provide care.
You may also assume the primary financial risk for your long term care costs. Review the cost of care in your area and consider inflation. This will help you determine the amount of savings that should be set aside for long term care.
Long Term Care Insurance
Long term care insurance is designed to help reimburse the cost of skilled or custodial nursing care in your home or in a facility. It provides a pool of money if you are unable to perform two of your daily living activities such as eating, dressing, getting in and out of bed, bathing or if you suffer from a cognitive impairment. Sometimes this coverage is available through your employer. If not speak to a professional who can help guide you through the process of selecting the right policy to fit your needs.