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s/o of a s/o: Long-Term Care Insurance?


Hyacinth
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Dh is nearly 60, so we're looking at long-term care insurance policies. The premiums are pricey (for us), but not having the policies and needing long-term care could--no, would--financially ruin us. Anyone else already have LTC policies or considering them for yourself or your spouse?

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We bought a combined LTC policy in January 2010. We were both 51 at the time. We got it for when we were "old." Yes, it isn't cheap. But 3 of our parents ended up spending some time in nursing homes so we thought it was a prudent decision. We didn't want to have to spend every cent we have saved for long term care, leaving the other spouse in financial jeopardy. Fast forward to the present. My dh, now 59 (not "old") has ALS. This June we started getting home health care 20 hours a week because I can't care for him 24/7 by myself. I am thankful we have LTC insurance  everyday.

No one can tell if they will need it or not. It is a financial decision for every family. Can you afford it? Will it give you peace of mind? What is your family history with aging? What will you do if you need care and don't have LTC insurance? There is no "right" answer for everybody. 

We have absolutely no family history of ALS. We had no inkling we would need it so early. 

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Our financial advisor has suggest LTC insurance several times.  I am very suspicious.  You have to continue to pay every month until you either need it or die.  They can raise the rates and you can choose to (a) stop paying and lose all the money you've put into it, (2) continue to pay whatever they ask, or (3) lower your benefits.  Many companies have gone out of business because their costs > their revenue.

My 2c.

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23 minutes ago, Sue in St Pete said:

Our financial advisor has suggest LTC insurance several times.  I am very suspicious.  You have to continue to pay every month until you either need it or die.  They can raise the rates and you can choose to (a) stop paying and lose all the money you've put into it, (2) continue to pay whatever they ask, or (3) lower your benefits.  Many companies have gone out of business because their costs > their revenue.

My 2c.

On the "pay it every month until you either need it or die", that's how life insurance works too, you pay until you die. The exception is whole life policies.

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17 minutes ago, Mary in VA said:

On the "pay it every month until you either need it or die", that's how life insurance works too, you pay until you die. The exception is whole life policies.

 

Unless it's a term policy that is only good for 20 years.

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I guess that's the point of all insurance, though, isn't it? You pay for it hoping that you won't need it. There are some hybrid LTC policies out there that are structured more like investment vehicles, so you might get some of the money back if you don't use the policy. I haven't read enough to know whether that's a wise avenue. (Anyone know?)

The idea that the rates could skyrocket as our ability to pay decreases (as Sue mentioned)...that's the part that concerns me. It's not like car insurance where you can shop around and find another similar policy. The older you get, the harder it would be to find a policy. Depending on your health status, it could be Impossible. 

Still, the "better than nothing for now" voice is strong in my head. 

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1 hour ago, Hyacinth said:

I guess that's the point of all insurance, though, isn't it? You pay for it hoping that you won't need it. There are some hybrid LTC policies out there that are structured more like investment vehicles, so you might get some of the money back if you don't use the policy. I haven't read enough to know whether that's a wise avenue. (Anyone know?)

 

 

In general the LTC plans that act as annuity/life insurance hybrids are the ones that seem to make the most sense for most people. A couple of links that help break down these types of plans:

https://www.nerdwallet.com/blog/investing/long-term-care-plan-save-money/

https://www.kiplinger.com/article/retirement/T003-C000-S001-use-annuities-to-pay-for-long-term-care.html

https://www.forbes.com/sites/jamiehopkins/2016/10/17/annuities-offer-long-term-care-funding-flexibility/#3b8876f02529

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We gambled with long-term disability insurance instead.  To this day, my dh doesn't know why he leaned toward that and actually got it without even telling me!  (He was in perfect health.)  One month later, he became permanently and severely disabled.  LTD insurance has made all the difference for us.

 

 

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Thankfully DH and I did it through his work when we were younger. The premiums only increase for cost-of-care increases, and are very reasonable.

If you do it, make sure that your family knows about it and knows how to file for it. My mother had a really good policy purchased 20 years ago, and my sibling never filed for benefits. That cost tens of thousands of dollars that should have been reimbursed and wasted all of those years of premiums.

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