Each year, as clients and I craft their financial plans, one of the biggest concerns expressed by those in the 45+ age group is long term care costs. Clients who are between 45-54 have some initial concerns, primarily because they are generally starting to see aging family members (grandparents, parents, aunts, uncles, etc.) and the issues that surface. However the 55-65+ age group often see the even greater challenge, since their parents are now well into retirement age, and these adult “kids” often start to become caregivers to at least one elder family member. They may also see friends and family around their own age who now have begun needing some type of care due to diseases like early onset Alzheimer’s and other debilitating conditions.
So, one of the discussions that I have with clients, especially those who are 55+ is whether or not long term care insurance makes sense for their situation. For some, it simply doesn’t. While for others, it is very important to protecting their spouse, protecting the way they are cared for (and who cares for them), and sometimes even to protect their legacy.
Anyone who has spoken with me about long term care insurance also knows that although I think it has its place in several situations, I also strongly feel that it is fraught with pitfalls.
For example, you may be talked into a policy without understanding exactly what your policy covers… and if you’re buying something that you may not need for 5, 10 or 20+ years, that could be a monumental mistake. LTC insurance is often sold through insurance sales agents, some of whom may not always put your best interests ahead of their own. Employer group policies often have limited coverage and end when your employment ends… which may result in you having to buy a personal policy when you leave your employer, at a later point in life when it will cost you more (or worse yet, not even qualify for LTC insurance due to a deteriorated health status at that point). And, some insurance companies that offer these policies make it difficult to collect on the befits. while others have astronomically increased the yearly premium cost to policyholders… to the point where some elderly clients can no longer afford to keep the policy at a time when statistically it’s most likely they will need it!
Below is an article that I came across called, “10 Secrets Your Long Term Salesman Won’t Tell You.” Although I didn’t write the article, I thought that much of it resonates with issues that I think consumers need to be aware of when evaluating LTC insurance.
As always, and whether or not you are a current client, if you have any questions please feel free to contact me.