The decision to purchase Long Term Care Insurance is a personal one, composed of a variety of factors that are unique to the individual. We’ve discussed some of the best ways to educate yourself about this decision and how to determine the path that is right for you.
Moving Past the Learning Curve:
Our past article, Just the Basics: Everything You Need to Know About Long Term Care Insurance goes through some of the most fundamental yet important information about purchasing Long Term Care Insurance for yourself or your loved ones. In it, we discuss the implications of deciding not to purchase coverage along with the reasons why it might be a wise financial decision.
We also cover the broad list of groups who are more susceptible to requiring coverage down the road, and the national statistics about these services as a whole. Once you have educated yourself to the point you can make a choice that fits for you, it’s time to start researching the best policies and prices to meet your needs.
“What Tools Can I Use to Calculate the Cost of Long Term Care Insurance?”
1. Cost of Care Calculators
Thankfully, calculating these costs and determining the right course of action for your LTC coverage is easier than ever before. There are a myriad of options to choose from in terms of where to gather this information.
After all, the internet houses the answer to nearly any question you might have. We’ve taken the liberty of compiling the most comprehensive and authoritative resources available so you can be sure that you are making your next big decision using the most reliable information possible.
It’s critical that you have an understanding of how much LTC services will cost down the road. Once you know how much it would cost out of pocket, it becomes easier to rationalize purchasing LTC Insurance so you know you’re covered for whatever life throws at you.
What makes this tricky, however, is the fact that LTC services are not stagnant. In fact, one of the only things that you can know for sure is that the cost of this care will continue to rise. Without accurate data and projections, it is difficult to know for sure how much more it will cost in the future than today.
That’s where having a reliable Cost of Care Calculator comes in handy. Not only does this trusted computational system adjust for extended time frames, but it also calculates factors such as the state of residence, projected inflation rates and the type of care that you expect to require.
Best of all, it’s incredibly easy to use. Simply visit (URL Slug Too Complex, will need to embed a link).
2. Cost of Care Breakdowns
A less interactive but albeit similarly comprehensive resource is an online Cost of Care Breakdown. A leader in LTC research is LongTermCare.Gov. What is great about this structure is that it can include a much more detailed breakdown of services and locations. While it does not go so far as including future projections for what LTC services might cost 15, 20 or 30 years down the road, a breakdown does provide an impressive amount of detail for costs as they exist today.
This document shows the differences in cost for the following LTC related services and standards of care:
- Home Health Aides
- Licensed Practical Nurses
- Registered Nurses
- Assisted Living Facilities
- Nursing Homes
It also helps illustrate the different options by including various pricing for the cost per hour vs cost per year for medical professionals such as Aides and Nurses. It also includes details about the following factors, all of which have the ability to change how much the services will cost you:
- Time of Day
- Extra Charges (If not utilizing an all-inclusive service)
- Variable Rates
By helping you fit these projected out-of-pocket costs into your assumed budget, you can begin to make educated decisions regarding the pros and cons of purchasing Long Term Care Insurance.
3. Evaluate Your Personal Risks
Recent studies show that nearly 7 out of every 10 American will eventually utilize some form of Long Term Care. On the plus side, this indicates that Americans are living longer. The disadvantage is that LTC is also expensive, and this stat means that nearly 70% of people will have to find a way to pay for future care.
Long Term Care Insurance acts as a buffer so your retirement fund doesn’t drain entirely into out-of-pocket costs as your care requirements become more costly. Certain government programs such as Medicaid do provide a level of assistance, but do not expect it to cover the entirety of your bills.
Personal risks also play a large factor in the kind of care you may someday require. For those with pre-existing conditions with a likelihood of worsening, odds are that you will need some form of LTC service in the future. It is important to perform a self-assessment and contemplate what your level of risk may be.
It is also important to weigh the risks of assuming you’ll never need LTC. Life happens fast, and it is impossible to know what circumstances might arise that would require you to receive more intensive Long Term Care. For this reason, many people investigate LTC coverage for peace of mind, knowing that should the unthinkable happen they are covered.
The key takeaway is that there are always options to protect the financial and physical well-being of yourself and loved ones. By educating yourself properly and intensively, you can make the appropriate choice for your particular circumstance. Luckily there are plenty of resources to turn to so you know you have the best and most accurate information available.
For further information regarding the truths and misconceptions of Long Term Care Insurance, explore some of our other articles which tackle more specific subjects such as Convincing Parents to Research Long Term Care Insurance and Two Starkly Different Scenarios Regarding Long Term Care Insurance.