We’ve heard the statistics. 70% of people turning age 65 will need long-term care (LTC) at some point in their lives. 15 million Americans are expected to need LTC by 2050. In 2015 there were $225 billion (Billion! not million) in LTC expenditures in the US. We know we should probably look into purchasing long-term care insurance (LTCI). But what age is the best age to purchase LTCI?
The inside joke in the LTCI world is that the best time to buy is the day before you need it. Having a crystal ball would come in handy some days. LTCI premiums continue to increase as we get older – but are locked in at the age that we actually purchase. The number of health issues we experience also usually increase as we get older, which can affect our ability to obtain LTCI or to get certain health discounts. Insurance carriers offer discounts for good health, and if you purchase a policy and your health changes, you won’t lose those discounts.
According to the American Association for Long-Term Care Insurance (AALTCI) the older you get, the higher your likelihood of being declined due to existing health conditions. Below the age of 50 only 20% were declined. From ages 50-59 declines rose only slightly to 22%. From ages 60-69 declines were about a third of all applicants at 30%. By ages 70-79 declines were almost half at 44%. So the younger you purchase, the more likely you are to get approved.
“Don’t wait to purchase long-term care insurance until it’s too late to apply for coverage.”
LTC Consumer, AALTCI and Kiplinger all suggest purchasing LTCI in your mid-50s. Dave Ramsey suggests age 60. It’s important to keep in mind your family history, your overall health, and what kind of savings you have set aside. If Alzheimer’s runs in the family, people tend to buy earlier. If Grandma and Grandpa were relatively healthy until their 90s, people tend to wait. Though, my dad passed at 57 from ALS and his mother passed at 93 from old age. So any sort of assumptions can be a bit of a gamble.
To find out the cost of LTCI at your age, or to see if LTCI is a good fit for your retirement plans, speak to a specialist today. Don’t wait until it’s too late to apply for coverage. You’ll save each month and each year by applying for LTCI before your next birthday.