Deciding Whether to Buy Long Term Care Insurance
Insurance is a huge industry in the United States, and in many ways it benefits the lives of millions by providing security over potential risk. Home insurance, car insurance, and even holiday insurance is taken almost as a given, but when it comes to long term care insurance, policy holders are something of a minority.
Understanding long term care insurance can mean that you make the right call when it’s time to start planning. Long term care insurance will ensure that help is available when the time comes for in-home care, assisted living, or even living in a nursing/retirement village.
What Are the Reasons for Purchasing Long Term Care Insurance?
This type of insurance will provide benefits whenever you are struck with the financial burden of care following disability or long term illness.
- You won’t be faced with handing the burden over to family members.
- You will have options as far as care facilities go, and in many cases can remain in your home for long term care.
- Your long term savings and investments will be protected when you have long term care insurance.
Five Tips for Determining If Long Term Care Insurance Is for You
1. Can You Afford to Self-Insure?
Buying long term care insurance policies can be expensive, and sometimes even those who are financially capable may be reluctant to invest in this type of insurance. If you can afford to self-insure through a risk management and savings scheme, it’s possible that you could be better off without a plan. Be aware that there is still a risk either way, especially if you require care that exceeds your savings plan.
2. Look for Strong Insurers When Investigating Policies
Insurance companies aren’t financially infallible. You may be buying policies that you don’t expect to use for another 10, 20, or even 30 years. If you’re still weighing up the decision make sure that you only consider companies with long histories and strong credit ratings. This will make sure that the policy is still there when you need it the most.
3. Find out about Group Policies before Purchasing
Find out from your employer whether there are group policies available for this type of insurance. It’s possible that you don’t need to sign an individual policy, making the decision even easier. Corporate group policies may come with additional benefits and subsidized costs.
4. Consult with a Specialist
An independent financial advisor who is experienced in long term care insurance will be able to assess your own financial situation and decide if insurance is the best option. Depending on your income and assets you may be eligible for federal benefits in the instance of long term care, so insurance is not a simple decision. An advisor will help you to work through all of the possibilities and assess the financial risk choosing for or against this insurance.
5. Don’t Wait Too Long before Acting
The longer you wait before deciding on insurance, the more risk you have of needing it before you’ve made your choice. Whether you’re going to self-insure, choose a policy from an insurer, or rely on other assistance methods, you need to make a decision as early as 20 years before retirement and begin contributing to your nominated plan.
Few people recognize that buying long term care insurance may benefit them at some stage of their lives. The reality is that if you require care that you haven’t planned for, you could face severe financial burden and stress, or even pass it on to your family. Deciding now whether to purchase long term care insurance or invest in other options will make sure you’re financially prepared for any unforeseen eventuality.
Bill Kinder @BKAssocAdvisors
Bill Kinder is the President and Chartered Financial Consultant with Bill Kinder & Associates. A company that helps people from all walks of life and income levels to position & manage their money wisely, minimize their taxes owed, protect their assets and plan for a comfortable retirement. Bill has been in business for over 35 years, holds a BS degree, plus a Chartered Life Underwriter and Chartered Financial Consultant certifications, as well as the Million Dollar Round Table’s “Top of the Table” honor. To date, he’s helped over 6,000 clients with their financial or estate planning needs. Follow him @BKAssocAdvisors or if you would like to ask him a question, send it to firstname.lastname@example.org. If you’d like a FREE ‘WISE Money’ Consultation, call him at (304) 250-0250.