in the cost of premiums will be enough
to offset the additional time. Plus, Kitces
says, “If you wait too long, the premiums
will be so high, they’ll be unaffordable.”
Like life insurance, long-term care cov-
erage requires medical examinations and
health questionnaires; waiting to purchase
a policy could make it harder to qualify.
The AALTCI found that nearly 43 percent people in their 70s who tried to purchase policies were denied coverage (and
just 18 percent of policyholders over 70
qualified for good health discounts).
CONSIDER COVERAGE CAREFULLY
The popularity of long-term care insurance has led to a spike in the number of
companies offering policies. It’s a good
idea to shop around, comparing coverage
and prices.
Since it’s impossible to predict what
your long-term care needs might be
decades in the future, look for a policy
with flexible options.
government-run benefits program. For
starters, you may be required to accept an
available bed in a subpar facility or location far from home. Even more of a concern is the impact on your family.
“You could impoverish your surviving
spouse by paying for benefits out-of-pocket
until Medicare kicks in,” Kitces says.
Long-term care insurance provides
more options for the quality of your care.
Although policies can be expensive—
coverage for a single, 55-year-old male
ranges from $960 to $2,035 per year, and
from $960 to $2,580 for a single, 55-year-
old female, according to the AALTCI—
the coverage is not just for the rich.
In fact, coverage was designed for the
middle class.
Jesse Slome, executive director of the
AALTCI, a nonprofit member organiza-
tion for providers of long-term care, says
those who lack the income to purchase
coverage (and will receive Medicare ben-
efits) as well as those who can afford to
cover long-term care out-of-pocket are
not the target market for long-term care
insurance.
“If you can afford coverage but not
an expensive long-term care event, you
should purchase insurance,” he says.
BENEFITS OF PURCHASING EARLY
The need for a nursing home bed or a
nurse to assist with dressing and bathing
might be decades away, but Pfau cautions
against waiting too long to purchase
long-term care insurance. The older you
get, he explains, the harder—and more
expensive—it will be to get coverage.
In 2014, the AALTCI reported that
more than 80 percent of policies were
purchased by those aged 45 to 64.
In short, Pfau says, “buying coverage
in your 40s is much better than waiting
until your 60s.”
Purchasing coverage earlier means
you’ll have to pay for coverage over a
longer period of time, but the difference
Weighing the pros and cons of long-term care insurance, comparing policies and
budgeting for premiums can seem overwhelming. But compared with the stress of
covering the cost of a long-term care event, the effort is worthwhile.
