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LONG TERM CARE |
How does it work?
Long term care insurance pays a daily amount for Home Health Care so that you can remain at home for as long as possible. If it becomes necessary for you to enter a Long Term Care Facility, it will pay a daily amount toward that care. Plans can be designed so that you cannot outlive the benefits. Furthermore, they can be designed so that the benefit increases 5% each year so that inflation does not erode its value.
It is important to understand that long term care insurance needs to be purchased while a person is still fairly healthy. The insurance companies will decline people who have serious health issues.
Who should buy Long Term Care Insurance
As a rule of thumb, if you have less than $150,000 in assets, excluding your home, you should skip buying this insurance. With modest assets like these, you would soon qualify for Medi-Cal. On the other hand, if your assets exceed $1.5 million it’s questionable whether you need this type of insurance. A modest return on your investment mass would cover your long term care needs. Remember, this is a rule of thumb. To be certain this rule fits your situation, give us a call.
People who have between $150,000 and $1.5 million in assets should give serious thought to Long Term Care Insurance. Approximately 30% of people will need these services as some point in life. With breakthroughs in medicine, more of us are living longer. The result is we are finding ourselves needing these services more frequently and for longer periods of time than those generations that came before us.
What Long Term Care Insurance will do
The primary reason people buy Long Term Care Insurance is so they don’t loose everything they have spent a lifetime working for. Most of us want our life’s work to go to our family, not the State of California. People who need this type of insurance and decide to put it off or not to purchase it, are risking loosing everything they have spent a lifetime working for. Medicare does not cover Long Term Care.
The second reason people purchase this type of insurance is so they can stay in their home longer. In our declining years, we want to stay independent for as long as possible. This type of insurance can significantly increases the amount of time we can remain in our own home.