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LTC insurance

By Terry Savage on October 09, 2021 | Insurance & Annuities

Hi Terry,
What is the wisest way to prepare for long-term care? I am a 59 year old single woman (no kids). I have approx. $1mm saved. I prefer to age in place and estimate the cost of in-home care could total as much as $4-5.5mm (worst case) – I am assuming $25/hour caregiver (LPN) with 2% annual salary increases, starting in 15-20 years – part-time and then 24/7 eventual need. If you were me, how would you prepare for this stage of life? THANK YOU!

Terry Says

You’re correct to be concerned. Just take a look at the 2021 Genworth “Cost of Care” interactive survey. As the population ages, and fewer immigrants come in to do nursing care jobs, the cost is bound to rise.

Here is what I did at your stage — a few years ago! I purchased Long Term Care Insurance. But those older policies can keep rising in price every year as the insurers are confronted with the cost statistics in the Genworth survey!

Instead, I recommend a “combo” policy of life/LTC coverage. You give them a one-time deposit now (or pay over 10 years) and get coverage for LTC for about 5 years. If you don’t use the coverage, you can designate a beneficiary to receive a death benefit (with no children, perhaps a good cause).

Here’s an example I used in a recent presentation for a MALE making a $100,000 deposit:

Male, Age 55, $100,000 deposit

LTC Benefit: $5,443 for 6 years
(90 day elimination period)
+3% annual benefits increase compounded
Death Benefit: $140,000

To get trusted, specific advice on a LTC policy I recommend you contact Brian Gordon, my LTC specialist at 800-533-6242. I know you will get expert advice you can trust. Feel free to use my name — or not — as I get nothing out of this recommendation except peace of mind!

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