Consider long-term care insurance while you’re young

Don’t wait until you’re 65 to think about care in your golden years. Almost 70 percent of the U.S. population will likely need long-term care before then, according to government statistics. With the cost of health care continuing to rise, long-term care insurance may be able to help. Now’s the time to think about long-term care and how those prospective services get paid for.

What is long-term care insurance?
Long-term care insurance is intended to provide coverage for an extended period of time. It’s also designed to offset the cost of care not covered by health insurance, Medicare or Medicaid. These policies reimburse you a fixed daily dollar amount if you need professional help performing basic life activities in your home, an assisted-living facility or nursing home. There are ranges of options and care benefits to match your needs.

Who needs a policy?
Unless you have enough wealth to handle the possible costs of future care beyond traditional health insurance, long-term care insurance is something to consider. It’s best to weigh the costs and learn more about what you’re paying for. Consider the following:

  • Effect your age will have on the policy cost at purchase.
  • Maximum amount daily reimbursable to you.
  • Maximum amount of time the policy will cover.
  • Availability of additional benefits such as automatic adjustments for increases in inflation.

Ask questions
Don’t be discouraged by the cost of buying a “Cadillac Plan.” You may be able to save on premiums if you can buy a policy with a shorter term and a lower daily reimbursement amount. This could free up money for other long-term care costs. There are also hybrid strategies. You could buy coverage for catastrophic events while self-insuring for less critical care with savings or home equity.

Article provided by Local Government Federal Credit Union.

The advice provided is for informational purposes only. Contact a financial advisor or insurance professional for additional guidance.