Protecting your estate
If you have an estate worth $2 million or more, you should easily afford long-term care insurance. The insurance will help protect your estate. Medicaid takes care of senior citizens who are in a lower-income range. For people who fall somewhere in the middle, it’s especially important to have the right coverage.
Buying at the right time
Experts say it’s best to buy a long-term care insurance policy when it’s still affordable. In most cases, people in their 50s can obtain a policy with affordable premiums. If you wait until you are in your 60s to obtain long-term care insurance, your costs will be considerably higher. Also, if your health declines as you age, it can also affect the ability to receive coverage.
Considering coverage, not just price
When shopping for a policy, don’t go by the price alone. The Wall Street Journal recommends also looking for reliability. Look for stable carriers that have good ratings.
Keeping a spouse in mind
Another factor you can consider when thinking about long-term care insurance is the shared benefits with your spouse. You can buy a “rider” that lets you share benefits, essentially doubling the benefits that your spouse could receive. Experts say a shared-care rider can cost 10 to 15 percent more in terms of premiums. An advantage is that the rider is less expensive than coverage for each spouse over the long-term. Talk to your wealth management company about discounts for buying policies with your spouse.
Buying long-term care insurance with inflation protection is a simple way to keep up with inflation or even beat it. According to the Wall Street Journal, it’s smart to price a policy with compound inflation. Whether you choose three or five percent inflation protection, it is important that you crunch the numbers.
Reading the fine print
Before making a financial decision on a particular policy, read the fine print and make sure you understand the definitions and terms of the policy. Some of the questions to ask include whether the insurer will pay the claims right away or if there is a waiting period. Ask about whether you can use a certain home care agency or if the agency needs certain licenses. Experts recommend choosing a policy that allows your beneficiary to hire a home health care professional to provide personal care as well as skilled medical care.
Your medical care as you age is an important component of financial planning. The healthier you are, the longer you can work. For more information on financial planning that protect you and your family and important employee benefits, please contact us.