Strategies for Addressing the Long-Term Care Threat

What are the real risks that you will need long-term care in your lifetime? Here is the answer to the question...It's either 0% (you'll never need it) or 100% (you'll need it).

I call it the "lottery you don't want to win...though the odds are significantly greater that winning the lottery.

Now, your planning strategies need to be based on this number... 0% or 100%.

• Be very serious about taking care of your health to minimize the chances that you may eventually need long-term care.
  


• Buy long-term care insurance. Buy according to what you can afford so that the insurance will pay for some, but not all, of the potential expenses. Some insurance is better than none.



• Maintain a reserve of savings that's dedicated to long-term care and won't be used for generating retirement income.



• Keep your home equity in reserve for the day when you might need long-term care. At that time, you might take out a reverse mortgage or home equity loan.



• Stay on good terms with your kids!



• Make sure to include your spouse when developing your strategies, and tell your children and close relatives about your plans. This way, they know what you've planned and can carry out your wishes, should you be unable to tell them.

Planning for long-term care may not be the most inspiring part of your retirement planning, but it's simply something you cannot afford to ignore.

Simplify your long-term care financing and planning with a
Long-Term Care Specialist!

What Long-Term Care Insurance Can Do for You

• Long-term care insurance is a type of insurance developed specifically to cover the costs of long-term care services, most of which are not covered by traditional health insurance or Medicare.
  
  Long term care insurance will actually keep you out of a nursing home. After you've had an event and you're either discharged from the hospital or you're finding yourself slowing down and you need a little bit of care at home, this allows you to have a person come in to provide a little bit of assistance while you take a shower, get dressed in the morning, help you cook food, etc."
  
  It is important to consider the following:
• Don't buy out of fear or emotion.
• Don't buy more insurance than needed.
• Don't buy too little insurance. That will only delay the use of owned assets or income to pay for care.
• Look carefully at the policy. There is no "one-size-fits-all" policy.
• Does the policy pay only for room and board in a facility? If so, plan for other expenses, such as supplies, medications, linens, and other things that may not be covered.
• It costs less to buy coverage for younger people. The average age of someone buying long-term care insurance today is about 57.
• Make sure that buying the long-term care insurance policy is a sound financial decision and affordable.
• Look at different options and talk with a Long-Term Care Specialist before making a decision.
  
  
  
  
  

Aging Baby Boomers Will Impact Long Term Care Services

Aging Baby Boomers will significantly impact the potential demand for long-term care services over the next two decades.

• Over the next 20 years, the number of Americans age 65 and older will more than double to 71 million, comprising roughly 20% of the U.S. population.
• Greater longevity among the Baby Boom generation will also contribute to increased demand for long-term care services—those surviving to age 65 can expect to live an average of 20 more years.
• As Baby Boomers live longer, their chances of needing some form of long-term care services will rise as well. Roughly 70% of people over age 65 require some form of long-term care, and more than 30% will receive some nursing home care in their lifetime.

It is important to have a plan for your own long-term care even though it may be 20-30 years from now.

Where will the money come from for your care?

Simplify your Long-Term Care Financing and Planning with Long Term Care Insurance Pros

Long Term Care Insurance Pay Outs

The American Association for Long-Term Care Insurance just released results of their research that reported what 10 leading long-term care insurers pay each and every day of the year. It's $10.8 million...365 days a year. That's 53% more than just three years ago in 2007.

The long-term care insurance industry often takes a beating in the media. That has certainly been the case over the past year as insurers announced rate increases and several decied to exit the business.

With so much money paid to claimants, it is obvious that this type of insurance is utilized by its insured. Planning for long-term care is necessary. To determine if long-term care insurance is appropriate for your individual situation, it's best to consult with a Long-Term Care Specialist.

Basic Parts of a Long-Term Care insurance Policy

You’ve done your research and have decided that Long Term Care Insurance (LTCI) is right for you and your family. The next step is to become familiar with the basic structural components of an LTCI policy.
When building an LTCI policy there are four primary variables that must be considered. They are:

• Daily benefit amount

This refers to the maximum amount an insurance company will pay per day when extended care is needed. To determine the proper daily benefit amount you must first determine the cost of care in your part of the country.

• Benefit period

This refers to the length of time an insurance company will pay benefits if the insured receives the full daily benefit amount. If the insured receives less than the daily benefit amount then the insured’s policy will last longer than the defined benefit period.

• Elimination period

The elimination period is similar to the deductible on your homeowners or auto insurance. It is the amount of money you, the insured, agree to pay before the insurance company begins paying.


• Inflation protection

Many insurance companies provide several options when it comes to inflation protection. The first and most costly option is 5% compound inflation option. This option, as the name suggests, automatically increases the daily benefit amount every year. Another option typically offered is a guaranteed purchase option which gives the policyholder the opportunity to purchase additional coverage. Under this option if you elect to increase your coverage your premium will increase, too.

These are the main parts of the LTCi policy. There are other riders and features that add to the flexibility of the LTCi policies. When it comes time to structure your LTCi policy, consulting with a LTCi specialist will save you considerable time and effort by using his experience and education to design a plan that is right for you.

Long-Term Care Insurance-What to Consider...

The news has been filled with lots of news regarding the long-term care insurance industry. Some carriers are announcing sizable premium hikes while other carriers are leaving the long-term care business entirely.
There are a couple of reasons that carriers find the need to raise premiums.

1. The carriers are seeing claims that are higher-than expected.
2. They have been hampered by low interest rates making it difficult to grow a cash cushion.

Does this mean that you should never consider this type of insurance? Absolutely not! It does mean that you should do your homework.

Policies offer dozens of permutations such as different daily benefit amounts, coverage lengths and ways to protect against inflation. Consult with an independent Long-Term Care Specialist who can help you design a plan that is specific to you and your situation.

Ask yourself if long-term care coverage is worth it?

You may be paying annual premiums for 20-30 years before making a claim or never using it. But skipping coverage can prove costly, too. The most expensive form of long-term care, a private nursing home can run more than $200 a day or more than $70,000 a year.

What will the cost be 30 years from now?

Long Term Care Insurance Worries Baby Boomers

Change is happening in the long-term care insurance industry and it's not all bad, but different.

Millions of baby boomers are afraid that they will not be able to afford long-term care insurance and at the same kind afraid that they can't afford not to have this type of coverage.

A rapidly aging population, lengthening longevity and unpredictable health care costs are some of the factors that highlights the need for long-term care insurance.

Insurance companies are looking to raise their rates and some are leaving the long-term care industry (Met Life). Met Life will continue to provide coverage for its existing policyholders.

The insurance companies are struggling with record low interest rates, which have dragged down investment returns. In addition, the insurance companies are seeing an increased utilization of the the policies.

The need for this type of coverage is there, the insurance carriers are going through "growing pains" where they are offering a product that will be utilized by over 50% of the people purchasing this type of coverage.

There are ways to to keep premiums affordable. It is important to consult with an insurance broker or agent that specializes in long-term care insurance. He can help you design a policy that will fit your income and needs.