Maximize your HSA e-Newsletter
Vol. 15, Issue 6
Start Early: Planning for Long-term Care Costs
Since last year, I have been talking about Financial Protection Program (FPP), where achieving Financial Security is as easy as six steps! Planning for long-term care costs is the fourth step in the FPP.
Long-term care is something no one wants to think about, but in order to achieve financial security, it’s necessary. You may think, “It’s never going to happen to me,” but no one is invincible, and hoping something doesn’t happen isn’t sufficient planning.
What is Long-term Care?
Long-term care also includes in-home care to assisted living facilities to skilled medical professionals needed after surgery. Nearly 70% of people 65 and older will need long-term care at one point in their life. Those odds are pretty significant.
Don’t leave your health and finances up to chance.
Long-term care is expensive.
Costs of nursing home care can reach up to $100,000 a year! A qualified home health aide costs around $20.50 an hour, similarly $20 for homemaker services. These costs quickly pile up into a monstrosity of bills. In one year, it’s likely to drain your savings—assuming you have them.
Do you have $100,000 lying around? Most Americans would answer no. In fact, a third of Baby Boomers have between $0 and $25,000 set aside for retirement. That’s a drop in the bucket of expenses if you don’t have long-term insurance and end up needing it.
Medicare does not cover long-term care.
Medicare does cover short-term care in a nursing facility 100% for the first 20 days, but after that, there is a daily co-pay of nearly $200. After 100 days, you are responsible for the full costs.
Who pays the costs?
Simply ignoring a potential problem could devastate not only you financially but the ones you love most. Don’t take that gamble.
The solution is long-term care insurance.
Having long-term care insurance increases the odds of you staying in your own home where you’re comfortable.
Plan sooner rather than later.
President – HSA for America
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