Planning for long term care is a challenge for many people as one out of a group of seven retirees will need long term care for an approximate five or more years.
Most of the working individuals don’t want to discuss the possible plans they can have till its too late. Statistics show that employees are struggling to save funds for their long term care needs during retirement, with approximately half of the senior generation needs attention.
The good thing is that any individual has several options to save for their long term care. However, you need to be creative. You can choose to invest your funds or buy an insurance cover for your long term care. Apart from these two, there are other ways you can invest in your long term care plan during retirement.
Some of the best possible ways include:
- SELF SUPPORT/ PAYING.
This is one of the choices you can decide for your long term care. Self-paying is considered to be expensive due to the strict laws and labor costs. You need to save an ever-increasing amount of money, considering the high price of the service. Since the costs are not specific, you can look for statistical data showing the value and the potential inflation of the expenses over time.
- GOVERNMENT/ VETERAN BENEFITS.
Veteran benefits are eligible to individuals who have served in periods of conflicts, and the spouses of veterans also benefit from such plans. Enrollment for these financial benefits is easy; however, you need to provide proof of service and receive approval from the VA.
- HEALTH SAVING ACCOUNT
If you qualify for high deductible health insurance coverage, you can open a Health Saving Account (HSA). Depositing funds in the account for future long term care needs is a great way to pre-fund the need as you get ready to retire. Individuals can save up to $3,450 and up to $6,850 if you have a family. Once you turn 55, you can save an additional $1,000 inside your HSA. Money deposited in this account is usually tax-free.
- APPLY FOR A LONG TERM INSURANCE COVERAGE
If you can look for a long-term care insurance coverage while you are still young, it would be a right choice. Many individuals state that these plans are expensive; however, the increase in cost is largely because they opt for a plan once they are older, and the cost is higher. A young couple could get a long-term plan for as low as $1,500, and the coverage levels would further determine the price of the coverage.
- INCLUDE A RIDER TO YOUR LIFE INSURANCE.
Adding a rider for long term care coverage on life insurance would be an added advantage and can help make this coverage more affordable. However, your qualifications could limit you as insurance companies avoid individuals with certain health conditions.
You may be able to get early, or accelerated, benefits if the policy begins paying out once you become terminally ill. However, the compensations would be a certain percentage of the death benefits. If the policyholder passes on, the benefits given to the beneficiaries would be deducted from the amount given out for their long term care.
If you have used all your savings and financial options, you can choose the Medicaid plan. The coverage is limited, but Medicaid would, however, cover for any long term care. You need to exhaust any of your financial resources before applying for Medicaid; otherwise, agree to a “spend down.”