Understanding Facts When Planning Long-Term Care
Senior Writer Matt McCann
Longevity is an important consideration when planning a successful future retirement. With longevity comes Long Term Health Care. The financial costs and burdens of aging not only affect you, but also your family, savings and lifestyle. Long Term Care Insurance makes things easier for you and your family. The American Long-Term Care Insurance Association said the nation’s insurance companies paid out $9.2B in benefits to American families in 2017 alone.
When you search the internet, you may find information that is not entirely accurate. Before retirement, it’s important to consider a few facts.
If you reach age 65, you have a 7 in 10 chance of needing some type of Long-Term Care service, the U.S. Department of Health and Human Services says. In 2016, the value of assistance provided by unpaid caregivers to Alzheimer’s or dementia patients was over $230 billion.
Many people think that Long-Term Care won’t work for them. Others think that their families can take care of themselves without any problems. The truth is, the risk of needing care increases with longevity as medical science advances. Without a prior plan the impact is enormous.
The national average for one year of home care is $49,192, based on a 44 hour week. The national average for assisted living is $45,000 per year, and one year’s wages for skilled nursing are about $100,000 per year. In 20 years, these costs will surely increase.
As part of your retirement planning, you should consider the financial costs and burdens of aging. Affordable Long-Term Care Insurance provides the resources necessary for quality care, whether at home or in a facility, making the family family.
About half of those who apply for LTC Insurance after the age of 70 are denied due to health reasons, while this rate is 17 percent for those under 60. Bonuses are very affordable – especially when you’re young. It is very important to take action before retirement.
Premiums are intended to remain at the same level, depending on your health, age and amount of benefits you apply for. You can read articles on interest rate increases. These increases have something to do with “legacy products”. These are the old set of policies that were priced in before the interest rate collapse and rate stabilization.
First, most long-term care insurance policies are intended to be premium. There are some policies where the premium increases every year by design as the benefits increase or as you choose to increase the benefits. However, most policies have premiums that are intended to stay at the same level depending on your age at the time of application, your health and the amount of coverage you choose. Since most people will choose some form of inflation protection, the premium is intended to stay at the same level as the benefits increase – the cost of the inflation benefit is already included in the premium. When reading articles on increased premiums, keep in mind that there are plans that increase over time intentionally.
Today, all plans are priced with a very low interest rate environment in mind (interest rates have been low in the United States for the last decade). It wasn’t always like this. There were rate increases in some older product lines. These increases were based on a number of factors:
• Interest rates
• Latency rates (meaning how many people drop out of their policies. In practice, few do, but this is not included in premium pricing on many legacy plans)
• Requests and insurance experience
Insurance today is much more scientific and conservative than it used to be. Premium costs now also take into account low interest rates, low delay rates and real loss experience. The Actuaries Association suggests that the chances of a rate increase on a long-term care policy sold today are very, very slim. Regardless of these realities, it’s not easy for insurance companies to raise rates on products sold today.
Working with a Long-Term Care specialist will ensure you get the right information you’re looking for. There are a number of reference websites for research:
Long-Term Care will impact you, your family, your savings and your lifestyle. Long-Term Care Insurance is Easy and Economical Asset Protection. These plans not only protect your savings, but also reduce the burdens on family members. Take action before retiring to benefit from lower premiums and your overall better health.
Matt McCann is a nationally recognized expert on Long Term Care planning and helps people across the country using his unique process of talking on the phone while viewing computer screens on their computers. With 20 years of experience, he has been working with all major companies in the Long-Term Care field. http://www.mcannltc.netLook at us here we are here.
