What is one of the most valuable gifts you can give your children? A long-term care insurance policy for yourself and your spouse. 
Long-term care insurance pays for your daily care when you can no longer independently perform two of the six basic “activities of daily living”: bathing, continence, dressing, eating, toileting, and transferring in and out of beds and chairs. This insurance also covers the supervision you might need if you develop a severe cognitive impairment such as Alzheimer’s disease.
Overall, we are living longer, increasing the likelihood that we will need long-term care for several years. According to the U.S. Department of Health and Human Services, at least 70 percent of people over age 65 will require some long-term care services at some point in their lives. Long-term care insurance isn’t just for the elderly. Nearly 41% of long-term care is provided to people under age 65 who need help taking care of themselves due to illness or injury.
Every day in my work, I see that my clients who need long-term care and have insurance to help pay for it, are better off than those who don’t have it. Why?
They have choices about where they receive their care: at home, in an assisted living facility, at adult day care center, or in a nursing home. For many of my elderly clients, one of their
greatest fears is having to leave their own homes.
They can choose who provides their care.
They reduce the stress and burden on their families. They are not forced to ask their children to change their lives to care for them. When a spouse or child chooses to provide the care, the insurance will pay for the caregiver’s respite.
They are better able to preserve their retirement nest eggs. The cost of care varies depending on where in the United States you live, where you receive your care, the skill level of the care, and the number of hours. Some of the annual figures I have personally seen my Vermont clients pay are $156,000 for 24/7 private in-home care, $60,000 for an adult day care program, and $84,000 for residential care specializing in dementia. The average cost of a nursing home in Vermont is $97,000 annually. These costs are expected to increase significantly over the next thirty years. Long-term care insurance helps to ease this financial burden and help a senior’s nest egg last longer.
Many people do not understand that Medicare and private health insurance do not pay for long-term care. These are medical insurance programs that cover doctor visits, hospital stays, and medical procedures. They do not pay for someone to help you move on and off the toilet and practice appropriate hygiene.
The earlier you purchase long-term care insurance, the less your annual premium will be and the greater likelihood that you will qualify for coverage. Many experts recommend buying it when you are 45 to 55 years-old. However, it is not too late to purchase a policy when you are in your 60s, and, depending on your health, in your 70s.
Before you buy, I recommend a meeting with your financial planner to see whether a long-term care insurance policy makes financial sense for you. If it does, shop around. Get quotes from more than one insurance agent and compare plans. Ask questions until you completely understand what you are buying, and how and when you can receive benefits. You might speak to the financial staff at assisted living communities and nursing homes to learn about their experience working with different long-term care insurance companies.
When you buy a long-term care insurance policy, you are helping to preserve your independence as you age. You are helping to reduce potential financial, health and time burdens on your family. Buying a policy is a gift for the future – both yours and your children’s.
