What is your long-term care plan?

According to a survey conducted by VerstaResearch in 2020, 96% of Americans surveyed feel it is important for families to talk about their long-term care preferences. However, 93% of financial professionals surveyed agreed people wait too long before discussing plans and options.

History tells us nearly 70% of people over the age of 65 will likely need care at some point. I believe there are two important questions to ask yourself here: 1) Have you discussed your desires with your loved ones? and 2) What are your plans to pay for the care you may need?

According to Lincoln Financial Group, the average cost in Missouri for skilled nursing care is $196 per day for a semi-private room and $228 for a private room. As for assisted living, it costs approximately $4,400 a month for a studio apartment.

In-home care varies greatly, but if you pay per visit for a RN, that will average out to approximately $142 per visit. What is your plan to pay for these costs, given Medicare does not pay for these services, outside of some possible temporary help if certain conditions are met?

There are a few avenues to help prepare for this cost. One is traditional LTC insurance, where you pay premiums ongoing for the coverage of your choice, the length of coverage and per day dollar amount. A second option is self-insuring by earmarking dollars for the potential cost from your portfolio. Third, you could see an elder care attorney to plan for Medicaid to pay for these costs on your behalf. And finally, you could purchase a hybrid insurance policy, where you fund a single deposit using leverage to provide a monthly benefit when you need it. Often, these hybrid policies have some type of return of premium if you change your mind and include a death benefit in case you never use it for LTC.

Advisory services are offered through Innovative Financial Planners, LLC, an Investment Advisor in the state of Missouri. Insurance products and services are offered through Innovative Insurance Consultants, LLC, an affiliated company.

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