Long Term Care is not for Everyone

Is long-term care insurance appropriate for you?

Possibly, but it really depends on your specific circumstances. A well-designed long-term care insurance policy may be one of the best financial decisions you'll ever make. It can play a very important role in giving you and your family the “peace of mind” that you will have all the necessary resources to pay for quality care - where and when you need it.

 

To Buy or Not to Buy

You SHOULD consider buying long-term care insurance if……

	You have significant assets and income that you are concerned about protecting.
	You don't have significant assets and income, but you don't want to rely on the Medicaid (Medi-cal in California) program.
	You want to remain independent and not have to rely on family or friends for care.
	You wish to guarantee you and your spouse will receive quality care, in the setting of your choice.

You should NOT consider buying long-term care insurance if….

	You are already eligible for the Medicaid (Medi-cal in CA) program and do not mind having limited choices.
	The premiums would greatly affect your current lifestyle and be a financial burden to pay.

Because today's long-term care insurance policies offer a variety of featues and benefits, it pays to take your time when choosing your policy. In this section we will help you take a look at what makes up a good policy and the benefit options available to you.

You should consider the following items before considering the details of a long-term care insurance policy.

	The benefits you receive in the future should be substantially more than the premiums you will pay in your lifetime.
	It should not be a "cookie-cutter" or generic one-size-fits-all plan. The policy should be customized to your specific personal and financial needs.
	The premiums should be affordable. Not only now, but in the future as well.

 

Common Misconceptions

"I don’t need long-term care insurance because my children have promised that they will take care of me!" Your children may or may not be willing to take care of you. Regardless, it probably would be unheard of for your children to actually tell you that they would NOT take care of you. In fact, most well-meaning children promise their parents they will NEVER put them in a nursing home. Unfortunately, there is a lot of guilt that children must deal with after making this promise. Let’s look at the reality of this promise. If you are 70 years old right now and your daughter is in her 50’s, that means that when you are 90 and need long-term care she will be in her 70's! Can you imagine a 70 year old trying to take care of a 90 year old? Or, worse yet, what if she needs long-term care before you do? Some other questions to consider are: Can your children quit their jobs to take care of you? What about taking care of their families? Are you prepared for the humility involved if your children have to bathe or change your diapers? "I have a disability income insurance policy so I don’t need long-term care insurance." Disability income insurance replaces a portion of your INCOME if you are disabled. It doesn’t also provide you with extra funds to pay for your cost of long-term care. A long-term care insurance policy is, however, an excellent compliment to a disability income insurance policy. "All of my assets are protected from being spent on long-term care because they are in a living trust!" A living trust only avoids the lengthy probate period in your state. Assets that are held in a living trust are counted as assets when determining Medicaid (Medi-Cal in CA) eligibility. With a living trust, because you have access to the assets, your state would require that you spend down those assets first, before qualifying for Medicaid.