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Created: May 13, 2024
Modified: May 28, 2024

Do I Need a Long-Term Care Plan?

David Shapiro joins Better Money Boston this week to delve into the crucial topic of long-term care and its financial implications. Long-term care, often associated with hefty price tags, is a consideration that everyone should have on their radar.

Who Should Consider Long-Term Care Plans?

The statistics are quite revealing: over 70% of individuals in the United States over the age of 65 will require some form of long-term care during their lifetime. Additionally, 15% of people over 65 may spend up to two years in a nursing home.

Given the high costs, particularly in areas like the Northeast, having a solid plan in place is essential for most of us.

Exploring Long-Term Care Options

There are several options available for long-term care planning:

  • Traditional Long-Term Care Policies: These are the “use it or lose it” types. If you end up needing care in a nursing home, the policy will pay out. However, if you never use it, the insurance company keeps the money.
  • Insurance Riders: There are various types of insurance, including life insurance with long-term care riders. This means that if you pass away, your family will receive a death benefit. If you require nursing home care, you can access some of the policy money to cover those costs.
  • Hybrid Annuities: A newer option, hybrid annuities combine traditional annuities with long-term care benefits. These may not cover costs as comprehensively as other options but provide some level of financial support if nursing home care is needed.
  • Self-Insurance: For some clients, self-insuring is a viable option. This involves using personal savings or investments to cover long-term care costs. While this path has its advantages, it’s crucial to have a structured plan to manage these high expenses effectively.

Why Having a Plan is Key

The consensus is clear: the most important step is to have a plan. Given that 70% of people turning 65 will need some form of long-term care, it’s prudent to start planning now.

This involves considering various factors such as potential medical needs, financial resources, and available support systems. By preparing in advance, you can ensure that you or your loved ones receive the necessary care without unnecessary stress or financial burden. Start early to explore your options and make informed decisions for a secure future.

Information presented in our podcasts is considered current as of the created date. Over time, some information presented may become stale. We recommend you consult with your Financial Professional before making any changes based on information contained here.

Johnson Brunetti is a marketing name for the businesses of JB Capital and JN Financial.

Investment Advisory Services offered through JB Capital, LLC. Insurance Products offered through JN Financial, LLC.

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