Long-Term Care Insurance: Peace of Mind at a Price

For many, the cost of long-term care insurance is a difficult item to budget into existing expenses and obligations. However, the cost of not having long-term care insurance could be far worse. Make sure you understand what the costs are with and without long-term care insurance, should the time come that you need long-term care. Thanks for visiting us at Advocare of South Florida. We work with families every day to determine what kind of care in the area is appropriate, available and affordable based upon individual circumstances.

If you ask what most people fear most in retirement, it’s being a burden. Long-term care insurance can alleviate that fear, but it doesn’t come cheaply.

About 70% of all retirees need long-term care at some point, although that includes help from family and friends as well as assisted living and nursing homes, says Jamie Hopkins, professor in the Retirement Income Program at The American College.

About two-thirds of long-term care comes from family members, Hopkins says. About a third of those who need help will eventually wind up in nursing homes or assisted living facilities. Men typically need 2.2 years of assistance, while women, who live longer, need an average 3.7 years.

Assisted living doesn’t come cheap: An average of $3,022 a month for a room at an assisted living facility, or $36,264 a year, according to the Assisted Living Federation of America. The costs go up if you need help with taking medications, getting dressed, or other daily activities. Full-scale nursing home assistance can run about $85,000 a year, says Frank Darras, a lawyer in Ontario, Calif.

Most times, you’re not going to get assisted-living care from the government, unless you’re a veteran or on Medicaid — and that’s typically reserved for the very neediest people. Medicare doesn’t cover the costs of assisted living if all you need is custodial care, such as help getting dressed. It does help with many medical costs, however.

The mistaken belief that the government will pay for long-term care is one reason why people don’t get long-term care. Another is that people don’t think they will need it. But the biggest cause is the cost: about $1,985 a year for a typical policy for a 55-year-old man, says Jesse Slome, executive director of the American Association for Long-Term Care Insurance.

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