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Don’t let long term care costs destroy your retirement

When we construct a financial plan for our clients we always ask about long term care because we often hear concerns like “who will pay my health care bills if I am not mentally capable?” and “where will the money come from to care for me?”.  These concerns are amplified when we work with clients who have been remarried, have complex family dynamics or clients who have no children or close family to help care for them when they get older.

One of the possible solutions to offload the burden of uncertainty is long term care insurance.  There are many types of policies out there but we recommend policies, for client who have the means, that are paid for upfront instead of policies with a monthly premium.  The main reason for my concern is that clients who pay monthly are at risk of 1. Forgetting to pay the premium at some point and the policy gets cancelled or, 2. The insurance company increases the premium to a point where the policy is no longer affordable – in both cases, you run the risk of paying for coverage that may not be available when you need it.

According to the U.S. Government Administration on Aging, 70% of people turning age 65 can expect to use some form of long-term care during their lives 1.  There are many ways to plan for the future costs of long-term care but we suggest that you plan for it instead of reacting to the situation should it arise.

Long term care costs

Some average costs for long-term care in the United States (in 2010) were:

  • $205 per day or $6,235 per month for a semi-private room in a nursing home
  • $229 per day or $6,965 per month for a private room in a nursing home
  • $3,293 per month for care in an assisted living facility (for a one-bedroom unit)
  • $21 per hour for a home health aide
  • $19 per hour for homemaker services
  • $67 per day for services in an adult day health care center

If you would like to see what the costs may be in your area, you can click this link and select the various levels of care from homemaker services up to private room nursing care.

Contact us to learn more about how we can help you update your financial plan or get started with creating your personalized plan.

David Cross, CPM®

1960 Satellite Blvd

Suite 2200

Duluth, GA  30097


Advisory services offered though U.S. Asset Management, a member of Advisory Services Network, LLC. 1040 Crowne Pt. Pkwy Suite 840 | Atlanta | GA | 30338 | 770.352.0449
Securities offered through Calton & Assoc. Inc. Member FINRA/SIPC 2701 N. Rocky Pt Drive | Tampa | FL | 33607
Advisory Services Network, LLC and Calton & Assoc. Inc., are separate and unrelated entities.