What do I Need to Know About Paying for Long-Term Care?

You should be planning for health care costs.

Health care is not cheap.

You know that.

In fact, you probably have a small idea of this every time you visit the doctor.

Or fulfill a prescription.

Or have a procedure done.

I wish I could say it gets better.

But it does not.

As you age, you will likely require more medical attention, not less.

You may even need assistance with the activities of daily living.

According to a recent Wealth Advisor article titled “Have Clients Planned For Long-Term Care?,” these costs can be staggering.

The median cost alone is $1,500 for health care.

What if you need to be in an assisted living facility?

This will cost $3,750.

Home health care services are more like $3,994 a month.

Need a home health aide?

This will require about $4,099 a month.

Nursing homes are an even greater expense.

A semiprivate room will run about $7,148 with a private room costing $8,121 on average.

Yikes!

This could clean you out of all your savings in short order.

How can you avoid this?

Chances are Medicaid is not an option.

Why?

There is an income limit to qualify.

It is a pretty low threshold and you would need to spend down (not gift) your assets to become eligible.

Do you have other options?

You could purchase a long-term care insurance policy.

What would this do?

It would provide coverage for adult day care, assisted living facilities, home care, hospice, or nursing homes.

Nevertheless, it may not be easy to get this type of policy.

What factors would affect this?

Your health may impact this.

Where you live could provide barriers.

The insurer may have specific limitations.

This decision should be well researched.

You will want to know the benefits and the duration of the policy.

You will also need to know your out-of-pocket costs and tax implications.

If you are healthy and in your late 40s to mid-50s, you should consider getting such a policy before your health takes a downturn.

The cost of coverage will only go up as you age, if your health issues do not disqualify you first.

Do not procrastinate, because hope is not a strategy to protect your retirement security.

Remember: “An ounce of prevention is worth a pound of cure.” When making your financial, tax and estate plans, do not go it alone. Be sure to engage competent professional counsel.

For more information about estate planning in Overland Park, KS (and throughout the rest of Kansas and Missouri), visit our estate planning website and be sure to subscribe to our complimentary estate planning e-newsletter while you are there.

Reference: Wealth Advisor (February 16, 2018) “Have Clients Planned For Long-Term Care?”