Planning for retirement always means planning for medical needs, but does your planning include long-term care? If you haven’t thought about how you would pay for long-term care or whether you will need it, here are some questions you should start asking.
Planning for Care
Who Will Need Long-Term Care?
If you are beginning to plan for retirement, you can start by figuring out whether you or a loved one will need long-term care. The truth is, most Americans will need some kind of extended care at some point in their lives, whether it’s home care for a few weeks or a longer stay in an assisted living facility. However, you may be more likely to need more intensive care if you have a family history of certain medical conditions such as dementia or Alzheimer’s disease. Previous injuries and illnesses can make a difference as well. But no matter your medical or family history, it makes sense to at least give some thought to planning to pay for long-term care.
How Can You Take Better Care of Your Health?
Chances are, you or a loved one will need a form of long-term care in the future. But when and for how long can be impacted by the choices you make to take care of yourself now. Practicing healthy habits, such as eating right and getting enough exercise, can help fend off illnesses that could land you in a long-term care situation. Exercise is also essential in preventing falls, which are the number one cause of serious injury in seniors. You can make modifications around your home to prevent these serious falls from happening. Put down some non-slip mats and place high-quality grab bars and a seat in your shower.
Paying for Care
How Can You Factor Care Into Retirement?
The best options for paying for long-term care all depend on your age and how close you are to retirement. If you are a bit younger and still working, you can adjust your retirement savings plan to include enough funds for long-term care. For those who are right on the cusp of retirement, you can still make small changes to your pension payout plans that will allow you to better save for the possibility of long-term care needs. Another option for paying for long-term care is the equity in your home. If you own a home, you can use it to take home equity loans, a reverse mortgage, or other options that will give you extra cash to pay for long-term care. Many people may also be able to use their life insurance to cover care. Depending on your policy and stipulations, you can sell your life insurance to give yourself extra cash to cover daily living expenses as well as any medical care needs. If you are unsure how to make long-term care part of your retirement plan, talk to a financial advisor.
Should You Plan to Rely on Medicare Alone?
When it comes to paying for long-term care, you may be surprised to learn that Medicare barely covers costs. Much of long-term care needs, in the form of help with day-to-day tasks, are viewed as custodial care, so Medicare will not cover these expenses. What you can do, however, is look into Medicare Advantage plans, such as those from Humana, that include added benefits for prescriptions, dental, vision, fitness services, and caregiver support. These plans can save you money in the long run, which you can put toward custodial care, and some features can even help you avoid the need for care in the first place.
How Does Insurance Factor In?
Typically, health insurance will cover very little in the way of long-term care. You would need to purchase long-term care supplemental coverage to help with expenses. Long-term care insurance can be a bit expensive, but you may be able to get a better deal if you sign up when you are a bit younger. Premiums increase dramatically from your 50s to 60s, so start looking sooner rather than later for long-term care coverage if you are interested in this option.
The need for long-term care for you or a loved one can come up when you least expect it. So make sure you are prepared to pay for long-term care so it does not impact your retirement.
