In 1967, the Beatles released the song, “When I’m Sixty-Four.” The lyrics are a preemptive plea to secure a relationship even when the realities of old age set in. Now, as the nation’s largest generation whistles this tune into retirement, the question seems less rhetorical:
Who is going to take care of us in retirement?
Not everyone will need long-term care insurance (LTC), but everyone needs a long-term healthcare plan. Your long-term care plan should incorporate the following: facts about you (and your spouse, if applicable), your age, your personal health, longevity of lineage, your retirement income and assets, your tolerance for risk, the costs and demographics of long-term care in your geographic area and information about any long-term care insurance that you own or have considered owning.
This post is the second in a two-part series. You can read the first on Long-Term Disability (LTD) by clicking HERE.
Long-Term Care Insurance
One very important thing to remember is that Medicare does not cover the costs of most long-term care needs. Allen Hamm, in his book, Long-Term Care Planning, shares the following statistics:
- 71 percent of Medicare recipients mistakenly believe Medicare is a primary source for covering long-term care.
- 87 percent of people under the age of 65 mistakenly believe their private health insurance will cover the cost of long-term care.
In order to help you navigate the two most complex forms of personal insurance, I’ve created two “apps”–in the form of Excel spreadsheets–that you can use to create a plan, analyze any policies you have and obtain apples-to-apples quotes for new policies, if needed. You can find the backdrop for the disability income exercise HERE and the long-term care exercise HERE, or just jump right in with the instructions given below:
These exercises are each a three-step process. Step One is to determine what you need. This is accomplished by writing out a Disability Plan if you are in your 30s, 40s or 50s. If in your 50s, 60s, or beyond, you need to articulate your Long-Term Care Plan. Not everyone needs insurance, but everyone needs a plan. Start the process by writing out a paragraph beginning with the following sentence: “If I became disabled [suffered a long-term health care incident], here’s how I would handle that financially…”
Step Two is to understand any coverage that you already have. The online exercise includes a template with spaces to fill in for the primary features mentioned in this two-part blog series. Once you have completed the template, you’ll better understand the coverage you have. Step Three is to determine what you actually need and want in a policy and create a template to retrieve quotes and find the best coverage. You’ll be better prepared for the engagement with the insurance agents because your template will ensure you’re comparing apples-to-apples, a very difficult thing to do with long-term disability income insurance and long-term care insurance.
Click HERE to access the long-term disability income app and HERE to access the long-term care app!