Protecting Your Retirement Nest Egg

Prepare for Long-Term Care in Advance

Maybe you’ve done everything you thought of to prepare for retirement—funding your 401(k) at work, buying life insurance for you and your spouse, and opening college funds for your children. But could you handle the financial implications of you or your spouse becoming ill or disabled and requiring professional care?

America’s elderly population now exceeds 35 million and will increase dramatically in the next 15 years, with more than half of those seniors needing some type of professional care. There is a common misconception that health insurance, Medicare, or Medicaid will pay for professional care if the need arises. The fact is, they don’t cover long-term care. The reality is that your own savings and assets will most likely be needed to cover these kinds of expenses. When you consider that the average two- or three-year stay in a nursing home can cost as much as $185,000, it’s easy to see how quickly your savings and assets could be depleted.

One way to prepare for these expenses is to get long-term care (LTC) insurance. LTC insurance covers expenses for in-home care and stays in nursing homes, assisted living facilities, and adult day care.

Some LTC policies even offer a cash benefit, providing a monthly payment for informal in-home care, unpaid medical expenses, and prescriptions. This type of benefit gives you a large degree of flexibility if you ever need to file a claim.

Just like any type of insurance, you should speak with a qualified financial advisor to see if long-term care insurance is right for you.