Pre-Planning for Long-Term Care
Are Your Clients in the Middle Age Bracket?
Middle age is defined as the period between early adulthood and old age, typically including 45 to 65 years old. This is also the prime age to consider a plan for long-term care that includes long-term care insurance. Pricing for long-term care insurance is based on age and health, so clients who purchase long-term care insurance at a younger age can take advantage of more affordable rates. Additionally, their health may decline as they get older. Our clients are typically healthier when they are younger.
The Demand for Long-Term Care is Increasing
The increasing demand for long-term care is due to the population shift that came with the Baby Boomer generation. The Baby Boomer generation can expect an increased life expectancy but also an increased risk of dependency and disability as a result of aging. As people age, they are at a greater risk for injuries and medical conditions that require care. Today, an estimated 133 million Americans – nearly half of the adult population – suffer from at least one chronic illness, such as hypertension, heart disease, and arthritis. That figure is 15 million higher than just a decade ago and is projected to rise to 170 million by 2030.
The Cost of Long-Term Care in Skyrocketing
The national average cost for a home health care aide is $169/day. This has increased over 10% in the last year and over 5% in the last 5 years on average. Just as our groceries, gasoline, and housing expenses have increased in the last few years – our health care is also increasing. This is due in part to the growing demand of care as well as the heightened safety protocols as a result of the Covid-19 pandemic.
Planning with Long-Term Care Insurance
If you haven’t suggested a plan for your client’s long-term care costs yet, you may want to consider pre-planning with long-term care insurance. When your client purchases a long-term care insurance policy, they transfer this risk to the insurance company. A long-term care insurance policy provides your clients with an income stream to pay for care at home or in a facility. Their loved ones can provide support to them as care managers rather than as daily caregivers. Long-term care insurance can be purchased with multiple funding sources, such as a Health Savings Account, a 1035 Exchange from an older annuity or life insurance policy, 401k, or IRA accounts.
Our LTCi division collectively has nearly 100 years of combined experience in supporting LTCi Specialists, advisors, and planners with their clients. Please contact a member of our team at 1-800-945-1953 to discuss the options available to your clients.