As we get older, sometimes we need a little extra help with everyday things, like getting dressed or making meals. This help is called “long-term care.” It’s not just about being in a nursing home—it could be someone helping you at your own house, or going to a special daytime program.
Now, paying for this kind of care can get really expensive, and it’s something more and more of us are thinking about in 2025. Let’s talk about “long-term care insurance” (we’ll call it LTCI for short) and why it might be something to consider.
Why Is Long-Term Care So Pricey?
Think about it: the cost of everything is going up, and taking care of people who need extra help is no different. If you were to stay in a private room in a nursing home these days, it could easily cost you over $90,000 a year! And even having someone come to your home to help out can cost $30 or more per hour. These costs are only expected to keep going up.
Now, you might be thinking, “Doesn’t my regular health insurance or Medicare cover this?” Well, usually not for the long haul. They mostly help with short-term medical stuff. There’s a government program called Medicaid that can help with long-term care, but you usually have to have very little money to qualify.
So, Why Think About This LTCI Stuff?
Getting LTCI is like having a backup plan for your future. Here’s why it’s becoming a bigger deal:
- Protecting Your Savings: Imagine working hard your whole life and saving up money, only to have it all disappear because you need long-term care. LTCI can help protect your hard-earned savings.
- Staying in Charge: If you have LTCI, you have more say in where you get care. You might be able to stay in your own home with help, go to a nice assisted living place, or choose a good nursing home instead of just going wherever you can afford.
- Helping Your Family: It can be tough on your family if they have to become your full-time caregivers. LTCI can help pay for professional care so your family can focus on being family, not just nurses.
- Planning Ahead Makes Sense: Nobody loves thinking about needing help later in life, but it’s a real possibility for many of us. Getting LTCI while you’re younger and healthier usually means you’ll pay less for it.
What Should You Think About When Choosing a Plan?
There are different kinds of LTCI plans out there, so here are some important things to consider:
- How Much Money Will It Pay? This is the most money the insurance will pay out each day or month. Think about how much care costs where you live now and might cost in the future.
- How Long Will It Pay For? This is how many years the insurance will help cover your care. Some plans pay for a few years, others for your whole life. Longer coverage costs more but gives you more security.
- How Long Do You Wait Before It Pays? This is like a waiting period, like a deductible on your car insurance. You might have to pay for care yourself for 30, 60, or 90 days before the insurance kicks in. A longer wait usually means lower payments.
- Will It Keep Up With Costs? This is super important! Because the cost of care keeps going up, you want a plan that increases how much it pays out each year. This is called “inflation protection.”
- What Kind of Care Does It Cover? Make sure it covers the types of care you think you might need, like help at home, assisted living, or nursing homes.
- Extra Perks (Riders): Some plans have extra options you can add, like getting some money back if you cancel the policy or letting your spouse use your benefits.
- Is the Company Solid? You want to make sure the insurance company is strong and will be around to pay if you ever need them.
- Your Age and Health: Usually, the younger and healthier you are, the cheaper it is to get LTCI. They’ll probably ask about your health history.
- Plans That Combine Life Insurance and Long-Term Care: Some newer plans let you get long-term care benefits while you’re alive, and if you don’t use them, your family gets a payout when you pass away. This can be a good option for some people.
Talk to Someone Who Knows This Stuff
Choosing the right LTCI plan can be a bit confusing, so it’s a really good idea to talk to a financial advisor or an insurance agent who knows a lot about long-term care. They can help you figure out what you need and find a plan that works best for you and your wallet.
Bottom Line
Thinking about needing long-term care isn’t fun, but it’s a smart thing to do. Long-term care insurance can be a way to protect your savings, have more control over your care, and ease the burden on your family. Don’t wait too long to look into it – the sooner you do, the more options you might have and the more affordable it could be.
