The medical advances achieved in the U.S. over the years have been great. Today’s treatment technologies and the medicines available result in people living longer. These longevity gains mean people have more time to enjoy things but one thing about living longer is the significant risk it creates to the investments and savings nest egg they put together for future years.
Why think about or consider this risk? Having to pay the high rates in Connecticut for the on going help needed following a sudden change in health could quickly use up a person’s “funds for the future”. This is especially true when the need comes from frailties later in life and goes on for an extended period. Thus, the risk to a person’s current and future financial situation is significant so the most economical plus effective approach to offset it is to purchase Long Term Care insurance.
How does it work? When a person owns this special coverage, which might be called long term health insurance, their plan includes a pool of money to hire professional assistance. For example, if a person age 55 selects a plan with a four year benefit period and an initial monthly benefit of $6,000; includes 5% compound inflation protection; and then looks to the future their plan’s maximum benefit pool would have grown to about $765,000 in 20 years.
The value a person receives from their maximum benefit pool is:
● Personal – it allows them to be as independent as possible; stay in their desired living environment; and have control over the type of and when assistance is received.
● Financial – it pays for required help, which means their “funds for the future” won’t be all used up.
Can you buy at any time? No. Approval is based on the person’s health at the time they apply. A recent survey found up to 33% of individuals age 60 to 69 who applied for this important financial protection were declined because of health problems. The American Association of Long Term Care Insurance, which I’m actively involved in, also found in their survey of 10 leading long term care insurance companies the decline rate for individuals 50 to 59 was 13.9%.
The probability a person will be eligible for this special insurance and thus gain its many values can be improved significantly by taking action to purchase at a younger age. Applying early provides an additional value. It will cost less because the premium would be higher each year you wait.
Bottom line: Taking some of your funds and purchasing a Long Term Care insurance plan today is the best way to protect the investments and savings in your “funds for the future”. Owning also means you — will Not Burden Family — will Be in Control.
© John C. Parker, RHU, Long Term Care Professional, 5/23/12
Learn more – http://www.LongTermCareIns-CT.com