Long Term Care Planning
What is the biggest financial risk most of us will face in retirement?
The answer is a significant long term care event. As a former financial advisor this was one of the most important and often times most difficult conversation to have with my clients. Current statistics tell us more than 60 percent of adults will experience the need for some form of long term care. With costs for assisted living averaging around $4,000/month in Wis. and Minn. and skilled nursing care in the $8,000/month range (and continuing to rise) it is easy to see how this can add up to a significant cost.
So what can you do?
The good news is everyone realizes this is a big deal, including the government. As a result they are making it easier and more attractive to plan ahead using insurance and other financial products. Long term care insurance is not for everyone but it is something to consider. Since we have an aging population that is living longer due to advances in health care, officials realize the less dependent we are on Medicaid, the better. Some of the incentives relate specifically to taxes, both before the need for care arises and also during and after the care is delivered. The insurance industry has also taken note and developed new hybrid products that address more than one need, all while coordinating with some of the newer tax considerations. As always, we recommend talking to your financial advisor about the best options for you.
Time to start talking
Talking about the very real risks and costs of needing long term care is one of the most important conversations you may ever have. Discussing this with your spouse, children, and your financial advisor will lead to a plan that you can all be comfortable with. The good news is you’ve taken a few minutes to begin thinking about it already… just by reading this article!