Long-term care financing and planning takes some thought and education to put together a policy that is best for you and your financial situation. It is easy to get confused and become paralyzed into "inaction." Here are some key points of what to do or not do.
Purchasing Too Much Coverage:
It is important to get some type of long-term care insurance without over insuring. Look at your finances and determine how much you can comfortably afford to pay for long-term care and co-insure with your long-term care insurance policy. Purchasing long-term care insurance can be compared to buying an auto. A Ford will get you to the same place as a Mercedes, but it will cost you much less. Having some long-term care insurance is better than not having any long- term care insurance.
Waiting Too Long:
You will not save money by waiting to purchase long-term care insurance at a later date. The cost for you today is less expensive than it will ever be. As you get older, the rates go up.
You need to seriously consider 5% Compound Inflation Protection, especially if you are under 70 years of age. It costs more, but it adds all the value to your long-term care insurance policy.
A Sound Long-Term Care Plan:
It is necessary to learn what your options are in the event that long-term care is needed. Do you have the assets to cover the expenses and still live the lifestyle you desire? Where do you want to receive care? How quickly can you liquidate your assets? Will you lose money if you liquidate? What are the tax consequences? Do we have enough income to live on?
Impact on Family:
How will a long-term care event affect your family? What happens when a spouse needs care? Will this affect the work of the other spouse? Is the family capable of providing the necessary care? Can the children help? How will this affect their work and family?
Many think that Medicare will cover all of the costs of long-term care. This is not true. It covers some very limited costs that meet Medicare's criteria.
Comparable and Competitive Quotes:
Some companies are more competitive in relation to age or health status. Long-term care insurance quotes should be compared from at least three of the top companies. Different companies have unique "sweet spots" depending upon age, marital/partner status and health
Long-Term Care Insurance Specialist:
Consult with a Long-Term Care insurance Specialist, an independent agent that stays informed of new plans that come into the marketplace. A long-term care specialist can easily help you compare the different plans getting them closer to an "apples to apples" comparison.
Shopping by Price:
Getting the lowest price for a long-term care insurance policy is not the way to plan. The cheapest price may or may not have the options that you will need when you are ready to use your plan.
When getting long-term care insurance quotes from three different companies, it is important to check the financial ratings of the company. You should look for companies with at least A ratings.
Long-Term Care Costs:
You need to be informed of the real cost of long-term care (home care, assisted living, nursing facilities) in your area. If you live in an expensive State, you will need to adjust your long-term care insurance benefits according to what the costs are in your area. If you are planning to retire to a less expensive area, then that should also be taken into consideration. Different considerations should be taken if you are planning on living overseas.
A Long-Term Care insurance specialist who represents the top companies can help develop an unbiased plan that is unique to you and your situation.