Is Long-Term Care Insurance Worth It in Retirement?

Is Long-Term Care Insurance Worth It in Retirement?

Is Long-Term Care Insurance Worth It in Retirement

As you plan for retirement, one big question is whether to buy Long-Term Care Insurance (LTCI). Before deciding, it’s important to understand what it is and what it covers.

What is Long-Term Insurance?

Long-Term Care Insurance helps pay for care services you may need later in life if you can no longer manage daily tasks on your own. These services might include in-home help, assisted living, or nursing home care. Unlike Medicare, which mainly covers short-term medical care, LTCI focuses on non-medical assistance with everyday activities like bathing, dressing, and eating.¹

With that in mind, here are five key reasons to consider when deciding if LTCI is right for you:

1. It Can Help Protect Your Savings

Long-term care can be very expensive. A private room in a nursing home can cost over $100,000 per year. LTCI can help cover these costs, reducing the need to dip into retirement funds or sell off assets.²

2. It May Offer Peace of Mind

Having a plan for future care needs can reduce anxiety — both for you and your loved ones. It ensures you’re financially prepared and relieves family members from having to make tough decisions or take on caregiving responsibilities.³

3. It Gives More Choices

With coverage in place, you may have more freedom to choose the kind of care you want — whether that’s at home, in an assisted living facility, or elsewhere — without being limited by what Medicare or Medicaid will cover.⁴

4. Premiums Can Be Pricey

LTCI premiums can be expensive, especially if you wait until your late 60s or 70s to buy. Prices also vary depending on your health, the level of coverage, and inflation protection options. Some policies even raise premiums over time.⁵

5. It’s Not For Everyone

LTCI often makes more sense for people who have moderate to high retirement savings — enough that they want to protect their assets, but not so much that they can easily self-fund care. For lower-income retirees, Medicaid may end up covering long-term care costs after they meet eligibility limits.⁶

The Bottom Line

Long-Term Care Insurance isn’t a must-have for everyone, but for many retirees, it can be a smart way to help protect their finances and maintain control over future care choices. Talk to a financial advisor to see if it fits into your personal retirement plan.

About Harlow Wealth Management

Harlow Wealth Management, Inc. is an independently owned and operated advisor. We serve clients living in the greater southwest Washington and Portland metropolitan areas, with an office in downtown Vancouver, Washington. While our firm was officially created in 2005, our founding president, Danny Harlow, has been serving the retirement financial planning needs of our community since 1973. We focus on helping those who are retired or about to retire by building a customized retirement strategy. Our proprietary approach, the “Harlow Way”, addresses the following 5 key areas: designing a sustainable retirement income strategy, addressing healthcare and long-term care risk, investments and growing your portfolio, taxes, and estate/legacy strategies.