Part of any solid financial or retirement plan for the future should include a plan for long term health care costs. How will you pay for extended care if you’re seriously ill or injured? Who will care for you if you can no longer care for yourself? Or, better yet, who will pay for your care? Will it come from your own savings, assets, or income?
We’re glad you’re thinking about these important questions now. As you develop a plan for long term health care costs, consider the following tips.
Keep Your Emergency Fund Stocked
A rainy day fund can come in handy for multiple uses. Keep it stocked up in the event your car dies, the roof leaks, or you need long term health care.
A fully stocked emergency fund can help reduce the stress and anxiety of an unforeseen event and may be just enough to help you get by for a while. Keep in mind, an emergency fund is just a start when planning for long term health care costs.
Make a Long Term Plan
An emergency fund can help in a pinch, but a more detailed financial plan should be developed before an event takes place so you’re ready to handle any situation. Your plan may include using your income or assets to cover your care needs or transferring your risk to an insurance company.
Have the Talk with Your Close Family
While we’d like to think a long term care event won’t happen to us, the statistics prove otherwise. Even if you’re young and healthy, talk with your close family members about your wishes and plans if you face a long term care event in the near or distant future. Starting a conversation with your family now helps eliminate surprises and panic later.
Don’t Touch Your Retirement Accounts
If you’re still actively working, avoid using your retirement accounts like an ATM to borrow money for a new car, college tuition, or a home remodel. Keep your accounts growing to support you in retirement, which may include helping to pay for your care.
Invest in Long Term Care Insurance
Just like you buy health insurance to help pay medical bills, car insurance to protect your vehicle, and homeowner’s or renter’s insurance to protect your investment, long term care insurance covers the risk of an expensive long term care event.
Long term care coverage is for when you expect to need care for 90 days or more. This could be due to an accident, extended illness, old age, or a cognitive impairment.
The cost of care is high and rising each year. Just think what it will cost 20-30 years from now when you may need it!
By investing in a policy now, you instantly transfer your risk to an insurance company. This means, if you are approved for coverage and experience an accident next month, you may receive a benefit when eligible. The same goes if 10 or 20 years from now you experience a cognitive impairment and can no longer care for yourself, your coverage can help pay for your care.
What’s your plan for long term health care costs? At LTC Consumer, we connect consumers with professional LTC Specialists who can help you navigate your insurance coverage options. Request a free quote and speak with a Specialist today.
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.