Why Invest on Long Term Care Insurance?

People invest for the sole reason of getting a "return” and there are many investment options people can choose from. However, the one thing people forget to prioritize investing on is their health. Nearly 70% of American adults turning 65 will need long-term care (LTC) at some point in their retirement, according to Longtermcareprimer.com. Meanwhile, the U.S. Department of Health and Human Service reported that 40% of the country's population will require long term care. People pay roughly around $81,000 to $122,000 annually for different types of long term care related services and supports. By 2025, these amounts are expected to double and by 2030, these figures are expected to quadruple. With this projected rise in the costs of LTC products and services, it would make it more difficult for the average American to afford these costs once they start needing them. If a person pays the costs of these services with his pension or other assets, it will not be enough to pay for the expenses and they might find themselves with financially depleted.

An Intelligent and Practical Investment

Long term care insurance (LTCI) is an insurance product aimed at protecting a policy holder’s health and finances. It is designed to cover long term care expenses, along with additional policy-specific benefits. The question of whether long term care insurance is necessary for baby boomers and other individuals concerned about their retirement is still a topic of hot debate. Expert advice from financial advisors will of course recommend that looking at a policy would be a good way of setting up a procedure to manage expenses that will come from nursing communities or in-home care. But in truth, does a policy really solve a legitimate concern or is it just another yearly expense to add to an already difficult budget? To answer this, you need to look at the benefits that an LTCI policy can give you:

• An LTCI policy is made specifically to pay for your LTC expenses in the future. It will ensure that your care needs will be funded.
• LTCI becomes a means of building up funds today, while you’re financially stable, that you can use later on, when you’re likely to be weaker due to old age.
• Though insurance can be expensive, it is significantly more affordable than the actual costs of care in the future.
• LTCI will keep your finances safe through inflation protection. Inflation protection increases your benefit amounts each year with no change in your premium. This feature will make sure that your benefits can pay your care expenses despite the inflation of LTC costs.

Paying for LTC expenses with only your savings is a risky plan. The costs of care will be heavily influenced by medical inflation, the highest in any industry. In a few decades, these costs will skyrocket, and would all but erode on your savings and melt your assets thoroughly and quite quickly. Unless you’re wealthy, buying long term care insurance is an intelligent and practical decision to make.

Increasing Rates and Premiums

The scary part about insurance policies that drive away most Americans is the cost of premiums. Insurance companies have recently raised prices and they can easily do so again with sufficient justification. Some have even closed shop, which enforces the idea that people should stay away from insurance. However, prices only reflect the current costs of today’s care, and companies will have to keep up their products’ costs with increasing medical inflation. With good inflation protection and by starting early, your policy can keep up with inflation to ensure that your benefits will be able to match your expenses.

Early Preparation

Time is an important factor though, as insurance and cost of care will only get more expensive. Furthermore, insurance carriers give better deals and special discounts to younger and healthier clients. Buying a policy at early age, such as in your 40s or 50s, is a good idea, since you can expect lower premiums and higher levels of inflation protection. Though you’ll be paying for a longer time, you will also end up with higher maximum benefits than your original terms. Investing on long term care insurance can solve many of the woes, financially and emotionally, that you would face later on in life, so speak with a licensed agent today. References:

• http://longtermcare.gov/the-basics/
• http://www.hhs.gov/
• http://www.longtermcareprimer.com/basics/ltc-statistics/
• http://www.ltcoptions.com/