Long Term Case Insurance
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Anonymous
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I feel like I will soon be at the age where I should consider Long Term Care Insurance. What are everyone's thoughts about it? Previously, I remember reading advice saying not to do it but that was a long time ago and I can't find the article.
What should I look for in long term care insurance? Is it considered to be a good idea? |
Anonymous
| I'm rolling the dice. No LTC insurance. Home retirement and college savings will be enough in a pinch. Sorry kids. |
Anonymous
| Home > Hope (sigh) |
Anonymous
| scam. |
Anonymous
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Our financial planner recommends it (he does not sell it, so it is not like he is selling us his own product).
We got it in our early 50s. We do know a number of people who in their 60s got Parkinsons or other debilitating illnesses and know of one family without long care insurance where having the insurance would have made a lot of difference. Our planner says it is questionable what form long term care insurance will take in 20-30 years but he recommends getting it for people in their 50s for illness which might occur in the 60s or 70s. It is much cheaper if you get a policy in your 30s or 40s, but we chose not to do that. |
Anonymous
| If you have had a cancer diagnosis (under age 50) but are in remission, can you get LTC insurance? |
Anonymous
| not sure, but they do ask a lot of medical questions and there are definitely diagnoses that preclude coverage. |
Anonymous
| We bought a policy on both of us after a relative was in a nursing home after eight years. |
Anonymous
How much cheaper? I'll be 40 next year and that's why I started thinking of it. |
Anonymous
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My parents got LT care insurance via John Hancock when they were 60 and 63, around 1997. My dad was diagnosed with a form of dementia in 2004. He had a series of medical complications mostly unrelated to his dementia and now has lived in a nursing home for over one year. My mom remains at home.
Financially, getting this insurance was the best decision they've ever made...insurance covers the majority of my dad's expenses associated with his care. My mom has not had to dip into her savings and can afford to keep their house. Catch is the LT policy only covers three years of assisted living/skilled nursing and then it simply ends. Statistically, I don't think my dad can live that long (and clearly the policy is written this way) and my mom has expressed fears that he could outlive his policy. I know that LT care insurance has significantly changed - even residents where my dad lives now who got LT policies a few years after my parents complain that coverage has been significantly been decreased and is less comprehensive. |
Anonymous
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With LTC insurance you get what you pay for. If you pay more, you get more years, inflation protection, deals where the spouses can use each others coverage, even deals where heirs can inherit if LTC is not used. There are all sorts of options.
Be careful about employer LTC plans - they may be good, but in our case we got more options for a little less money by going individual with the same company that provided my husband's group plan. You get significant discounts by buying at younger ages, but think that one through carefully as the market in LTC is changing a lot and there may be different products out in 20-30 years which you might prefer. Obviously a catastrophic illness can hit at any age, but more likely as you get older. If you are wealthy, LTC may be unnecessary as you can "self insure". It is really designed for mid range income/wealth people who want to protect assets (like a home and savings). We are older parents, so part of our concern to have LTC is if we could no longer work in our sixties, our kids' college plans would not be derailed. Our ds has some LD issues. We certainly think he will work and earn a pretty good living, but would like to leave him something. Remember - the best case scenario is that you never use your LTC and all the money you spent on it is wasted! |
OTAlexFA
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Research a product called "MoneyGuard" by Lincoln. It's a unique strategy that is actually a life-insurance product but whose main purpose is LTC. Surrender is 100% after 5 years but provides an increasing amount of coverage via an inflation percentage. If you never use the LTC aspect, it provides a death benefit, too.
It is expensive (min. $50K, max. 10 pays) but a pretty good investment if you have ever been through the situation before and feel the need to participate. Also, if you have cash on the sidelines in a retirement account, this is one way to put it to work. |
Anonymous
explain |
Anonymous
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I have a hard enough time dealing with insurance companies now when I'm young and healthy. I can't imagine doing it when I am old and needing care. Plan to self-insure instead.
Jill on Money had a recent episode about LTCI: http://jillonmoney.libsyn.com/180-long-term-care |
Anonymous
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If you are currently healthy, younger than 60, and financially solvent place $75k in a stand alone brokerage account. Purchase equal percentages of ETFs that deal exclusively with Preferred Stocks and pay a 6% annual yield, but pay the dividend monthly so you can receive the maximum benefits of compounding. Set up the account automatically reinvest your monthly dividends into perpetuity.
This is the one account you never touch until that day hopefully a long time away, perhaps a decade or two when you may really need long term care. If you are currently healthy and you have a fair sized nest egg to start with, self insuring is the way to go for long-term disability insurance. |