Those of you planning for retirement..what is your LTC plan?

[Frwinkley]

We are about 4 years away from retirement. We’ll be in our early 60s. Fortunately, we are both in excellent health. I’m beginning to think about LTC insurance. I’ve read pros and cons.

If you don’t have such insurance and don’t plan on purchasing it, can you tell me why?

 

[tvguy]

I have LTC insurance, but someone who has adequate retirement income or assets to cover the $4,000 to $10,000 a month per person cost of long term care probably would not be inclined to purchase it.

 

[QueenIsabella]

We will be self-funding any LTC needs we have. If we end up not needing the care, the money can go to our children.

 

[clh2]

We will also be self-funding any long term care needs.

We are currently 61 and 58. We have worked with a financial planner for almost 30 years, and an estate planner for about 4 years. We believe that by having a proper estate plan, as well as an adequately funded retirement, , LTC insurance is not needed.

 

[Frwinkley]

Those are my thoughts as well. We are prepared to self-fund our LTC expenses and I’m much more comfortable with that strategy.

 

[starry_solo]

Self funding it. I expect to retire with 80-95% of my last year's pay (thank you pension!) which should be enough to self fund. If necessary, I'll sell my house.

My hope is that I can make do with a caregiver that comes in daily (that I won't need a live-in CG but one who checks on me and if I'm dead, notifies proper authorities)

 

[georgina]

Agree. LTC policies are just too expensive.

 

[barkley]

Agree. LTC policies are just too expensive.

and they are only going to get more costly as the companies have to start paying out at an increasing rate.

the census bureau estimates that in the next 30 years the number of seniors (65 and older) will grow to 80 MILLION, and the number of people who will need ltc will more than double from around 12 million a few years ago to 27 million. factor in cost of living increases for the cost of long term care and those ltc companies are either going to have to massively escalate the cost of premiums or go belly up. sure, the policy owners have some safety with state guaranty associations but if there's a massive upswing in companies going under i could imagine months if not years to get individual payouts (and will providers wait unpaid in the meantime?).

i know these provide peace of mind for allot of people but the numbers have never made long term financial sense to me-despite what people perceive as high premiums today, there's no way they seem high enough to support what they are intended to pay out and still make the nice profit margin the insurance companies take right off the top.

 

[lorenae]

No LtC insurance here. We aren’t wealthy, but we’re able to take care of ourselves and our needs. If one of us needs LTC, we will manage and pay for it ourselves.

 

[erc]

I live in Maine. My LTC is called Death with Dignity.

 

[Frwinkley]

Pennsylvania resident....wish I could say the same thing.

 

[Buzzsgramma]

We don't have any LTC ins...if you wait to late it is more expensive...make sure it is adjusted to inflation...I will say i have seen a few families that saved and were frugal for all their life see their money go to nursing homes... One firends husband who had Alzhemier was in a memory care facility for 4 years to the tune of $8000 a month....that's the low end of cost around the suburbs of Chicago...I watched other family members spend $250,000 for the 2 of them in a home before they went on Medicaid.....Put your assets in a trust and and give your family members gifts tax free to them of up to 18,000 a year.....

 

[smmco]

I live in Maine. My LTC is called Death with Dignity.

I've instructed my kids if a need long term just to pillow stuff me. Joking aside. My mom is self-funding her LTC. A massive stroke at age 79 Honestly it's no way to live. Isn't LTC insurance just 2 years? My mom pays 8k a month when she's completely broke the state will pay for it. Why did she save all that money?

 

[barkley]

Put your assets in a trust and and give your family members gifts tax free to them of up to 18,000 a year.....

before structuring your assets it's best to consult an attorney trained and specializing in elder law in your individual state. there are federal medicaid laws but structuring with those in mind as well as an individual state's program(s) can make a huge difference (i supervised a state medicaid eligibility unit in the 90's and it was devastating to encounter someone who had gifted away monies and set up irrevocable trusts that didn't follow both federal and that state's medicaid laws-ineligible to coverage/gifts had already been spent/trusts were unavailable to them).

 

[MillauFr]

The LTC insurance industry is filled with crooks. I wouldn't touch one of those policies with a ten foot pole. The only other area of the insurance industry that is worse is the travel insurance sharks.

 

[ronandannette]

We're Canadian and the public health care system provides for both assisted living facilities for seniors and long-term care. There are also private facilities that might arguably be nicer that the public ones, but that's basically a lifestyle choice for those that can or want to, afford it. I'm not even sure if an insurance product to provide for this is even available here. If it is, I've never met anyone who has mentioned having it.

 

[peabody58]

We had LTC insurance for about 3 years, then cancelled it after I read all the fine print and put the numbers into a spreadsheet. It was a very expensive education into financial planning. We retired at 57 (now both 62). We consider our paid off home as our LTC if we ever need it.

 

[HeatherC]

I started a thread on this a few days ago on the Community Board if you want to check it out.

I am in the minority here and do plan on purchasing it. My mom is currently in an assisted living facility that is almost 7,000 a month. So far she has been there two years this month. Without their policy, this would not be possible.

Long story short, over the past five years she has been in and out of hospitals, rehab facilities, misdiagnosed with Alzheimer’s, etc.. The LTC policy they have has been a lifesaver.

My parents purchased an amazing policy many years ago and it is now paying off. The specific policy they have is no longer offered. It provides for inflation and lifetime care. So if my mom lives another 20 years, she is covered.

My parents have always made good financial decisions and have done quite well financially. This is just another piece of the plan.

No one plans to get sick or ill, but life happens. I, for one, don’t want to be a burden on my kids. I also don’t want to end up in a place that is horrible or offers a lower level of care because it is all we can afford. My mom is in an amazing facility and we have seen the different levels of care that are out there.
I am grateful every day she is where she is. Not many people can say that about assisted or nursing facilities.

We also don’t want to wipe out a life’s worth of savings that can be passed to our kids or grandkids because we didn’t plan ahead.

Yes, they are exorbitantly priced. But it is just going to be part of our retirement plan. We are planning to purchase within the next couple years after we are finished with the last kids college tuition payments. I only wish the policy my parents have still existed.

 

[Frwinkley]

OP here: my mother is in an amazing memory care facility in Texas. It is also about 7k a month. We (she) is able to pay for it with her own funds. Between her monthly pension and her SS, half of that expense is covered. The remaining expense each month is paid out of her 401k and the proceeds from the sale of her house. Thanks to the stock market, she’s basically lived there free for the last 2 years. She is only 77 and in excellent physical health. The way we’ve figured it, she could live there comfortably for another 15 years.

Yes—it will wipe her out financially leaving her 4 children with no inheritance. We’re all ok with that; none of us are wanting for anything.

just as a side note—my parents had no disposable income ever so purchasing LTC insurance wasn’t even on their radar. My mother worked a state job when my youngest sibling started high school. My father was a mechanic. When he retired, he had 100k in his 401k—he thought he was a millionaire. He died after a battle with lung cancer, so no LTC was needed. He would be thrilled to know that neither he or my mother were ever a burden on his kids; that’s all he ever hoped for.

I guess my point is that it just depends on what you think your money is intended for. We only have one child so anything that remains will go to her. If we’ve used our assets for LTC, I know that financially she will be ok. She is a dentist and her husband is an engineer—they make more money than we do!

Having a pension and a significant stream of monthly income seems to be key. I am a teacher so I will have a pension when I retire.

 

[mjkacmom]

We're Canadian and the public health care system provides for both assisted living facilities for seniors and long-term care. There are also private facilities that might arguably be nicer that the public ones, but that's basically a lifestyle choice for those that can or want to, afford it. I'm not even sure if an insurance product to provide for this is even available here. If it is, I've never met anyone who has mentioned having it.

Here, if you get into a nice place and self pay for several years, there is a good chance they will provide a government bed if and when you run out of money. If you need a facility and have already run out of money, you usually up in a much crappier home.