Category Archives: Reasons to Buy Long Term Care Insurance

Long Term Care Insurance and the Baby Boomer Generation

Long term care insurance and the baby boomer generation is a hot topic today. From 2011 to 2029, baby boomers (those born between 1946 and 1964) will turn 65. During this time period, 10,000 people will turn 65 every day.1

With so many baby boomers in the workforce reaching retirement, we could face a shortage of nurses and support staff. Not to mention, a strain on government assistance programs such as Medicaid.

Learn more about the challenges baby boomers are facing and the importance of long term care planning.

Government Programs May Not Handle the Influx

Medicaid is a government assistance program for low-income, elderly or disabled individuals. Eligibility may vary by state, but in most cases, participants are required to spend down to $2,000 in assets before being eligible.

With 76 million baby boomers reaching retirement age within the next decade, can state Medicaid budgets keep up?

Knowing the wave of baby boomers is looming on the horizon, the government attempted to solve the issue with a provision in the Affordable Care Act (ACA) called the CLASS Act, a national voluntary long term care insurance program. Unfortunately, this was repealed in 2013 when they couldn’t develop an affordable product.

Relying on the government for your care may not be the best option. It’s important to take control of your future by planning now.

Baby Boomers Will Live Longer and Need More Care

Due to medical advances, baby boomers are expected to live longer, resulting in higher care needs for longer periods of time. Depending on your state, the current annual cost of care for home care or facility care ranges from $50,000 to over $100,000.

These costs will only increase in the future due to inflation.

The Cost of Care Is Increasing Each Year with Inflation

If you think the cost of care is high now, just think what it will be 20-30 years from now when you need it!

Inflation increases the cost of care 1-4% each year. This is why it’s important for baby boomers to make a long term care plan now.

By planning ahead, you’ll know who will care for you and where the money is coming from to pay for your care.

Long Term Care Insurance and the Baby Boomer Generation – Planning Is More Important Than Ever

Providing care for a loved one can be physically, emotionally, and mentally draining for family members. If you’re a baby boomer, prepare for your future now with a long term care plan to protect your family.

Peace of mind comes from knowing you’ll be taken care of when you need it most and have the financial means to do so.

Secure a long term care plan for your future now by speaking with an LTC Specialist today. Learn more about your options and get an instant quote for long term care insurance here.

LTC Consumer is an independent, free online service to help consumers understand what long term care insurance is, how it works, and how to evaluate coverage options. Our mission is to provide an educational, no-pressure resource for learning about long term care planning, with the opportunity to speak with specialists who can help them.

1 Visualizing Health Policy, Kaiser Family Foundation. August 28, 2013. Volume 310, Number 8.

Should You Buy Long Term Care Insurance with Your Spouse?

Statistics tell us a healthy female, age 65, has a 67% chance she will live to age 90 and a 38% chance she will live to age 951.

It’s no surprise that women typically live longer than men and require more care. So does this mean only one spouse should be covered by long term care insurance? Not necessarily. We’ll explain why.

In most cases, we recommend you buy long term care insurance with your spouse to cover your full risk and take advantage of extra benefits or incentives. If you’re on the fence about applying for coverage with your spouse, the following are a few discounts and incentives you may want to consider.

You Receive Discounted Rates

Most insurance companies reward married couples who apply together and are approved for coverage by offering discounted rates. Discounts may vary by carrier and can save you up to 30% on your premium resulting in significant savings over the life of your policies.

Since gender-based pricing entered the market a few years ago, costs for females have increased significantly to account for women living longer and needing more care. This break in premium for spouses is a great incentive to lower the rate and ensure you’re both covered in the event you need care together or at separate times.

Shared Care Spreads the Coverage

You share everything with your spouse, why not share your long term care benefits? Shared Care is an additional rider that can be added to your policy when you and your spouse are approved for coverage.

This valuable benefit acts as a bridge between both of your policies allowing you to share each other’s pool of money. If one of you uses your entire benefit, you can dip into your spouse’s policy for more coverage. Essentially, shared care can double your long term care benefit.

For example, Mr. and Mrs. Johnson purchase $200,000 each in long term care benefits. Mr. Johnson uses all of his $200,000 while Mrs. Johnson’s policy remains untouched. Because they added Shared Care, Mr. Johnson can access her benefits for additional coverage.

Survivorship Pays Up

Survivorship is another optional rider that can be added to policies when both spouses apply and are approved for coverage. When one spouse dies, Survivorship allows the surviving spouse to have a paid up policy. In other words, all future premiums for the surviving spouse are forgiven. These riders typically require the policies to be in place for seven to ten years before a spouse dies to be eligible to be paid up.

Survivorship can be expensive and is not for everybody. Though this added protection may be beneficial when there’s a large discrepancy in age between you and your spouse.

For example, a much older husband is statistically more likely to leave a younger bride with many years of life left after his passing. Survivorship ensures her future care needs are secure with a paid up policy. These are hard facts to face, but important to consider when applying for coverage together.

Still wondering if you should apply with your spouse? When financial constraints only allow one spouse to be covered, we believe some coverage is better than none. Get an instant quote for you and your spouse today and speak with an LTC Specialist to consider your best options.

LTC Consumer is an independent, free online service to help consumers understand what long term care insurance is, how it works, and how to evaluate coverage options. Our mission is to provide an educational, no-pressure resource for learning about long term care planning, with the opportunity to speak with specialists who can help them.

1Genworth Financial. A2000 Basic ANB Mortality Table with Scale AA mortality improvement.

Planning for Long Term Care When You Are Single

Betsy was my next door neighbor when I bought my house.  She was 87 years old and living in the same home that her parents built and that she lived in as a child.  I remember running over to help Betsy as she was up on an old ladder cleaning out her gutters.  My wife and I got to know her and her daughters who would lament they have been trying for years unsuccessfully to get their mother to move to a more manageable place.

Besty is not alone, in fact today there are more Americans living as a single household than ever before.  A recent study showed that more than 1 in 4 of all American households are single individuals.  Contrast that to 1920 when it was just 5%.

So what should you be thinking about if you are single and planning for the future and if you need long term care?  Here are some simple tips for planning for long term care when you are single:

  1. Develop a local network of friends.  Not only is having a steady group of friends important for meeting for coffee or dinner but they can help if you need other things.  When you are sick they can bring you meals or even check in on your house when you are away.
  2. Develop a written plan and give it to a trusted friend or family.  Your written plan should not just be your will and medical directive but also practical things like financial account logins and passwords, safe combinations, and if you need care how will personal care be provided and paid for.  Imagine if you could not communicate for some reason, how would your bills be paid or you be taken care of?
  3. Review your household chores and how they get done.  As we age, sometimes simple things like cleaning the gutters can be risky, especially when we are single.  If we fall and get hurt without someone else around this can make a simple injury life threatening.
  4. Regularly check in on your friends and they on you.  Having a regular check in, whether a simple call, email or meeting for lunch not only builds relationships but also lets someone know if you are not okay.

By keeping your social network of friends strong and implementing a few key items single people can enjoy being alone without truly being all alone.

LTC Consumer is an independent, free online service to help consumers understand what long term care insurance is, how it works, and how to evaluate coverage options. Our mission is to provide an educational, no-pressure resource for learning about long term care planning, with the opportunity to speak with specialists who can help them.

3 Things Baby Boomers Should Consider When Planning for Healthcare in Retirement

“I believe the key to happiness is; someone to love, something to do, and something to look forward to.”  Elvis Presley.

Baby Boomers have changed the world in many ways.  According to the 2014 US Census there are 76.4 million baby boomers and they are making a steady march towards retirement. Retirement for a baby boomer will look very different than previous generations.  For example, they are estimated to live longer than any previous generation and consume far more healthcare dollars than ever before.  One of the largest challenges for baby boomers is how much money to set aside in retirement for healthcare.  There is an inherent fear that they may outlive their retirement savings.  A 2014 Fidelity study found that the average couple retiring at age 65 will spend roughly $220,000 in healthcare costs like doctors, insurance, and drugs; but that doesn’t include anything for long term care services.

So, if you are a baby boomer preparing for retirement, what should you consider?  Here are 3 things baby boomers should consider when planning for healthcare in retirement:

  1. Look into Long Term Care Insurance.  Long Term Care insurance is like retirement disability.  If you are not able to care for yourself due to aging or a medical condition, the insurance pays for a professional to come and help.  It can cover simple things like cleaning, cooking, and helping with errands, to very skilled nursing care.  By using insurance instead of your retirement savings, it helps insure you do not live beyond your savings and protects your kids from having to provide care.
  2. Work with an insurance specialist.  Would you hire a roofer to wire your house?  Probably not.  Just like contractors, you will get better advice and lower costs by working with an insurance specialist in specific areas like Medicare Supplements, Long Term Care, and Annuities.  Make sure you find a specialist who works primarily in that product line and represents many companies.  They can work on your behalf to get you the best deal so you don’t have to do all the work.
  3. Start early.  Baby Boomers never think they will get old, sick or hurt.  But unfortunately, it still happens to everyone, eventually.  By starting early in your mid to late 50’s by setting up your team of specialists or getting educated on products like long term care, you will be more likely to have the coverage you need at the time you need it.  Just like you can’t buy home owners insurance AFTER your house is on fire, it is best to plan ahead and have the insurance in place BEFORE you need it.

Baby Boomers changed everything from music, television, to the internet.  They will also change the way retirement healthcare looks and by planning ahead and following these simple steps, they will be ready to shake up the establishment in their later years as well.

LTC Consumer is an independent, free online service to help consumers understand what long term care insurance is, how it works, and how to evaluate coverage options. Our mission is to provide an educational, no-pressure resource for learning about long term care planning, with the opportunity to speak with specialists who can help them.

Save on Long Term Care Using Your Health Spending Account (HSA)

According to the Department of Health and Human Services, 70% of people who reach age 65 will need some form of long term care in their lifetime.  It is a scary fact, but what may be scarier is finding ways to pay for your long term care insurance.  You may be interested to learn how to save on long term care using your health spending account (HSA).

For those who may struggle to fit paying for long term care insurance into their budget, the good news is you may pay for premiums with your HSA.  It must be a ‘tax-qualified’ policy (which most are) and the amount you can withdraw tax-free for these premiums depends on your age.

In 2015, you can use up to $380 tax-free from your HSA for long term care insurance premiums if you’re 40 or younger, $710 if you’re 41 to 50, $1,430 if you’re 51 to 60, $3,800 if you’re 61 to 70 and $4,750 if you’re over 70.  This amount increases each year to account for inflation growth.

If you chose not to use your HSA money to pay for a portion of your premiums, you may also be able to count those premiums as tax-deductible medical expenses.  You would need to follow the guidelines outlined in our 2015 Tax Guide.

LTC Consumer is an independent, free online service to help consumers understand what long term care insurance is, how it works, and how to evaluate coverage options. Our mission is to provide an educational, no-pressure resource for learning about long term care planning, with the opportunity to speak with specialists who can help them.

Is long term care insurance deductible?

One of the most common questions we receive about long term care insurance (LTCI) is: Are my long term care insurance premiums tax deductible?  One of the greatest features of LTCI is: It is tax deductible!

For individuals, current tax laws state that you may be eligible for tax breaks on premium of tax-qualified1 LTCI as it is considered a medical expense.  If you itemize your federal income tax deductions, medical expenses are deductible to a certain extent, based on your age.

If you are under age 65, and your combined medical expenses (tax-qualified LTCI and other medical expenses) exceed 10% of your Adjusted Gross Income (AGI), you may be eligible for a deduction.  Currently, if you are 65 or older, the threshold is 7.5% of AGI for tax years 2013-2016.  Any portion of LTCI premiums outside of the eligible premiums listed below cannot be includable as a medical expense.2

Tax Guidelines

For more information on tax credits, ask about specific policies from given providers in your state; then check with your tax advisor or refer to LTC Consumer’s 2015 Tax Guide as most policies are tax qualifying.

LTC Consumer is an independent, free online service to help consumers understand what long term care insurance is, how it works, and how to evaluate coverage options. Our mission is to provide an educational, no-pressure resource for learning about long term care planning, with the opportunity to speak with specialists who can help them.

Disclaimer: This article does not constitute legal or tax advice and should not be construed as tax or insurance advice.  It was neither written nor intended for us by any taxpayer for the purpose of avoiding penalties, and it cannot be so used.  Please speak with your tax advisor or long term care insurance specialist in regards to a particular situation.

1A tax-qualified policy is based on the guidelines defined by the Health Insurance Portability and Accountability Act of 1996 (HIPAA).
2Allowable deductions are set by the Internal Revenue Code (IRC) section 213(d)(10).

Why do Single Women Need a Different Long Term Care Insurance Plan?

Science recently made a profound discovery: women and men are different!  Women are not only physically different, but in general think and speak very different than their male counterparts. Add to that a 2014 study from the US Bureau of Labor Statistics that found for the first time, the majority of the adult population in the United States identifies as single.  In contrast, only 37.4 percent of the population identified as single in 1976.

How does being a single woman affect your plans if you have an extended healthcare event and why do single women need a different long term care insurance plan?  The life expectancy for women is 5 years longer than for men and by age 65, 1 in 3 women will live to age 90 or more!  When you consider the average cost of home healthcare is more than $50,000 per year today, living longer and requiring care can add up quickly.

When considering long term care insurance, single women will need more comprehensive coverage.  We recommend having a monthly benefit of $4,000 or more and a benefit period of 2 years or more.  This will provide a solid base to pay for home healthcare, which is most common.  The other option to strongly consider is an inflation benefit that will grow the policy over time to keep up with the rising cost of care.  We recommend an inflation rate of 2-3%.

What is most important is that women have a plan of help in place before a long term care event occurs.  That plan should include who will help if care is needed?  Is that a friend, relative or professional?  How will that care be paid for and where will care be provided?  Making sure these questions are answered and talked about with those affected is critical, regardless if insurance is the right choice.

Having a plan in place allows single women to have the peace of mind that they will be cared for in case the need arises.

LTC Consumer is an independent, free online service to help consumers understand what long term care insurance is, how it works, and how to evaluate coverage options. Our mission is to provide an educational, no-pressure resource for learning about long term care planning, with the opportunity to speak with specialists who can help them.

Long Term Care Insurance Needs for Families without Children

Couple Walking

The top reasons people purchase long term care insurance are: protect their assets, gain peace of mind, and not be a burden on their family and/or children.  But not all families include children.  The odds of needing some form of long term care in the future do not discriminate by marital status, income level or any other demographic.  Often times people will “default” to having their children provide care, so for families without children this creates a higher need to plan ahead for a long term care event.

Facing a long term care situation is never easy, but these challenges are more intimidating in certain respects for families without children.  Becoming educated about your options, making your wishes clear to your spouse or partner, and deciding how you want to financially address a long term care event early on can help big time in the end.

Not only do you face a risk of needing care, but you may also be faced with becoming a caregiver yourself.  With no children of your own to care for, your parents place a higher expectation on you for tending to their needs.  This can be an eye opener to the financial and emotional challenges of a long term care event.  You may also bear more of the risk of caring for your spouse or partner without an adult child “on call” in the event care is needed.

Having a long term care insurance policy ear marks money specifically for a long term care event, taking off the added pressure that you may face.  The policies also feature care coordination services.  These provide the insured and their family with a host of local private and public services to help in the event of care being needed.

We recommend people have a plan in place before age 60 which will list out who provides care and how that care is paid for, regardless if there are children involved.

LTC Consumer is an independent, free online service to help consumers understand what long term care insurance is, how it works, and how to evaluate coverage options. Our mission is to provide an educational, no-pressure resource for learning about long term care planning, with the opportunity to speak with specialists who can help them.

Why Should I Buy Long Term Care Insurance?

You do a lot to plan for the future, including buying health insurance for when you get sick, life insurance for when you die, home-owners insurance in case of a natural disaster, etc.  As you plan for the future, you also need to plan for an extended illness or accident that stops you in your tracks now or at the end of life.  The truth of the matter is, 70% of people turning 65 will need long term care at some point in their lives.  You can either play the odds; or you can be prepared.

Below are some reasons why you may want to buy long term care insurance.

  • Protect your assets. A long term care event can bankrupt you.  Long term care insurance can provide a safety net for your assets as you move into your retirement years, allowing you to spend your time traveling, picking up new hobbies, or whatever else your retirement dreams may be.
  • Gain peace of mind. Having a plan in place can provide peace of mind knowing that if/when a long term care event occurs, you have a plan in place and money coming in to help pay for it.
  • Cover the costs of long term care services you may need.  If you don’t have the savings to pay for long term care, you should get coverage.  The 2014 average cost of care was $87,600 per year, a 4% growth from 2013.  With the rising cost of long term care, you could be looking at some hefty bills by the time you are in your eighties.  If you can’t afford a fully-loaded policy, some is better than none!  It will offset your spending while you financially plan for the costs.
  • Protect your family.  People purchase long term care insurance to protect their family from financial, emotional and physical demands of caring for them during a long term care event.  You can leave a legacy for your kids and avoid having to depend on family members to care for you.  Get care when you want it and from whom you want it.

Not everyone needs long term care insurance, but everyone needs a long term care plan.  If you’re interested in the cost, get a free quote in seconds.  If you have questions or want more information, you can request info on a plan and a state-licensed, professional LTC Consumer Specialist can consult with you by phone or email to explain how the plan works.

LTC Consumer is a free online service to help consumers understand what long term care insurance is, how it works, and how to evaluate coverage options.  Our mission is to provide an educational, no-pressure resource for learning about long term care planning, with the opportunity to speak with specialists who can help them.

Population of Long Term Care Patients Increasing

The population of people needing long term health care services in the US – both in percentage and in sheer numbers – continues to increase. It has been for many years. Here are three reasons why.

1 – Baby boomers. The generation born in the years after World War II ended has reached senior status. There are more elderly than ever before, and they comprise a higher percentage of the total populace than ever before. These numbers mean that more and more people will need some form of long term care in their final years.

2 – Longer life. Between advances in medical science and improved general education about and attention to overall health, the average American’s life expectancy is longer than that of all previous generations. And the longer one lives, the more likely one is to require long term care at some point.

3 – Fewer caregivers. Longer lives also mean more widows and widowers. Without a spouse or significant other around to help with care, people are more likely to seek help at long term care facilities or hire in home nurses.  Also, many people are single in the first place, and many do not have adult children who are willing and able to provide care for their parents. Having fewer “built-in” family caregivers puts a greater burden – in time and in money – on other sources of long term care.

These and other factors (the rise of diabetes and obesity, for instance) combine to create a potential societal crisis around the provision of and payment for long term care. If across-the-board solutions are not forthcoming, it falls to individual families to deal with their own specific situations. That’s where long term care insurance comes in.

LTCI is a way for middle-income people to plan ahead, and apply for coverage that extends beyond what traditional health insurance covers. It can serve as a way to protect retirement savings, prepare for an uncertain future, and gain invaluable peace of mind. Experts are available to help consumers understand how it works, explore the many available options, and get down to the specifics of suitable policies and premiums. And sooner is better than later – we’re not getting any younger.

LTC Consumer is an independent, free online service to help consumers understand what long term care insurance is, how it works, and how to evaluate coverage options. Our mission is to provide an educational, no-pressure resource for learning about long term care planning, with the opportunity to speak with specialists who can
help them.