November 16th, 2015
There’s a month or a day to celebrate or call attention to any and everything. Did you know that November is Long Term Care Awareness Month? The logical question then becomes, “Why do I need to be aware about Long Term Care?” The primary response would be because long-term care is a rapidly escalating aging issue that people fail to take into account when planning for their senior and retirement years. And, most people do not plan for the long-term care of themselves and loved ones.
First, some facts:
So, who will pay for this care? What options are available? Traditionally, family members have provided the greatest amount of long-term care. Unfortunately, families are stretched thin by the need for multiple income sources. Many families also do not enjoy the close geographic presence that once was the norm. But, even if family care is available, it is not cheap. Family care still costs an aggregate of $450 billion per year according to the Federal Commission on Long Term Care.
Other options are to pay for long-term care needs from savings and investments, personal loans, or Medicare and Medicaid. But think about it, Medicaid is essentially a welfare program that presents problems of quality of care and access care. It also carries strict asset limitations. It is hard to believe that anyone aspires to leaving their long-term care needs to Medicaid. But, that is precisely what results from the lack of planning.
Long Term Care Insurance is another option. There are different plans available with features of maximum daily benefits and benefit periods, maximum lifetime benefits, specific types of care, inflation protection among others. Some plans actually accumulate a cash value that may be payable to heirs if the care benefit is not used.
The most important take-away is that, like retirement, long-term care requires planning. One resource that may be available in this planning is a Reverse Mortgage loan. Proceeds from a Reverse Mortgage loan can be used to purchase a long-term care policy or to provide a funding source to support in-home care. Take some time to look at your options while planning for your retirement years. Then, call me at Tidewater Home Funding (757.366.8690) and let us help.
- Charlene Turner, Reverse Mortgage Specialist, NMLS# 456052
*Genworth 2015 cost of Care Survey; assumes 4% inflation
**American Association for Long-Term Care Insurance (AALTCI)