Many people believe that having a retirement plan in place will keep you financially afloat post-retirement. However, even with a substantial amount of money in a retirement account it is always better to have a long term care policy in place.
Having a long term care policy will not only protect you and your finances but also grant you and your family relief from the uncertainty of your future medical care.
You have a 70% of needing some type of long term care service at some point in your life, according to the United States Department of Health and Human Services. So while you may think your retirement plan will cover these costs, it is likely that you could end up draining your retirement account and having little or no back-up finances. Long term care insurance is there to help protect you from this happening, which will in turn help your family and friends from having to pick up the slack.
Your monthly payments can vary depending on your plan. Although extra bills are never ideal, the investment is well worth it in the long run. Most policies will almost, or more than DOUBLE in value within 20 years. This can provide you with a substantial amount of money to help cover your expenses. Insurance companies want to make it easiest on you and can help you decide what is most cost efficient and feasible for your lifestyle.
The average price of an assisted living facility comes out to around $40,000 per year, while the average nursing home is double at around $80,000 per year. Most people cannot afford this solely on savings or retirement funds. There are important factors that you should think about when averaging out the costs you could end up spending.
Some things that you should consider when analyzing the potential money you will spend:
- Prices of assisted living and nursing homes can always fluctuate or change.
- The number of years you will need extra care is uncertain.
- These numbers are based on the average cost, so depending on where you live and your preference of care, those prices can vary, and even be more.
- If you have a spouse who also requires care, the price will double, if not more.
Once you calculate the numbers, this can end up costing you hundreds of thousands of dollars, which is why it is so beneficial to have a policy in place.
Long term care insurance can seem complicated, overwhelming or unnecessary if you do not have all the facts. That is why long term care insurance providers are there to help and keep you informed while providing you with coverage that can keep you and your finances at bay.
As you can see, assisted living and nursing homes can be extremely costly. Having an extra cushion of money during your retirement is not only financially smart, but a way to help you and your family have piece of mind for the future.