long term care insurance
The cycle of life… our introductory years into this world consist of total dependence. Unable to take care of ourselves, we rely on caretakers (parents/grandparents/family) to monitor our health, feed us, clean us, etc. The bulk of our lives consists of independency, in which we take care of ourselves, manage our own lives, and more often than not, provide care for the younger generation. Once we enter into the realm of old age, we once again find that we become (at least somewhat) dependent on others to manage our lives, be it family, friends or nursing care. Although family and friends do their part, the responsibilities governing their own lives prevents them from providing the complete amount of care that is more often than not needed for seniors beyond a certain age. This type of round-the-clock care can only be found in nursing homes/facilities where a dedicated staff caters to your health and daily needs. The question is, should you eventually require some kind of nursing care/supervision, will you be able to afford it?
Did you know that over 40% of all Americans who are over the age of 65 will spend some time in a nursing home due to some form of prolonged illness or disability? Currently, 1 year in a nursing home is estimated to cost somewhere between $36,000 & $60,000, with a national average of $41,000. There are some people who think that Medicare/Medicaid/Health Insurance offers enough coverage to provide for long term care, however, these people are unaware of the fact that Medicaid is nothing more than a welfare program, and that even the combination of health care & Medicare only pays about 3% of the costs that are associated with long term care.
What is Long Term Care?
- Coverage for cognitive impairments such as Alzheimer's/dementia.
- Skilled nursing care or rehabilitation training either in a nursing facility or at home.
- Coverage for daily care ranging from eating & moving, to bathing & dressing.
Who Pays for Long Term Care?
- Health Insurance & supplemental programs such as Medicaid & Medicare DO NOT cover any kind of nursing home care.
- Individuals pay most of long term care costs through their savings, assets & cash.
In summation, long term care insurance policies can end up being extremely expensive. The typical costs associated with long term care for a married couple over the age of 65 consists of approximately $7,000 in annual premiums. On thing to keep in mind is that you should avoid policies that have premiums that exceed 5% to 7% of your yearly income.
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