As a Certified Financial Planner™, I often say that no retirement plan is complete without a long-term care strategy. Why? Because over 70% of people over age 65 will need some form of long-term care during their lifetime. And without a plan, the costs can quietly erode your retirement savings—and your peace of mind.
Let’s walk through the basics of long-term care: what it is, what it costs, and the smartest ways to prepare financially.
What is Long-Term Care?
Long-term care (LTC) refers to a range of services designed to help individuals with chronic illnesses or disabilities who can no longer perform basic activities of daily living (ADLs), such as bathing, dressing, eating, or using the bathroom, independently.
Types of Long-Term Care
1. In-Home Care
- What it is: Non-medical personal care services provided at home
- Who it’s for: Individuals who want to stay in their homes as long as possible
- Average cost: $4,500-$5,500/month for part-time services
2. Assisted Living Facilities
- What it is: Residential communities offering support with daily tasks, meals, housekeeping, and social activities
- Who it’s for: Individuals who require daily assistance but don’t need 24/7 medical care
- Average cost: $4,000-$6,000/month
3. Skilled Nursing Facilities (Nursing Homes)
- What it is: Facilities providing round-the-clock medical care and supervision
- Who it’s for: Individuals with serious health issues or post-hospital care needs
- Average cost: $8,000-$12,000/month
4. Memory Care
- What it is: Specialized care for individuals with Alzheimer’s or other cognitive impairments
- Who it’s for: Those requiring a secure environment and memory-focused support
- Average cost: $5,000-$7,500/month
How to Pay for Long-Term Care
1. Self-Funding
- Paying out of pocket from savings, retirement accounts, or investments
- Best for: Those with significant assets, but this approach can quickly deplete a portfolio if care is needed long-term.
2. Long-Term Care Insurance
- Traditional policies or newer hybrid products (life insurance or annuities with LTC riders)
- Pros: Help preserve your savings and provides guaranteed benefits
- Cons: Premiums can be high, especially if purchased later in life.
3. Asset-Based Long-Term Care (Hybrid Solutions)
- Combine life insurance or annuities with long-term care benefits
- Pros: If you don’t use the LTC benefits, your heirs receive a death benefit
- This is often a great fit for clients looking to protect both income and legacy
4. Medicaid
- Government program for individuals with low income and assets
- Limits: Only covers nursing home care unless in specific Medicaid waiver programs. You must spend down assets to qualify.
5. Veterans’ Benefits
- For eligible veterans, the VA may cover some or all long-term care costs through the Aid and Attendance program or VA nursing homes
Why Planning Ahead Matters
The earlier you plan, the more options you’ll have—and the more control you’ll retain. Waiting until you need care often means fewer choices, higher costs, and more stress for your family.
As a planner, I help clients:
- Understand what kind of care is realistic for their situation
- Evaluate different funding strategies
- Integrate LTC planning with their overall retirement, tax, and estate plans
Let’s Create a Long-Term Care Strategy That Fits You
Your long-term care plan should be as unique as your retirement goals. Whether you’re exploring insurance, using your portfolio strategically, or just want to understand your options, I can help you make confident, informed decisions.
Call (828) 559-0299 or visit me at 68 South Main Street, Suite 200, Marion, NC, to schedule a conversation.
Because retirement isn’t just about living longer—it’s about living better, even if your needs change.