3. When should I begin giving serious consideration to purchasing long-term care insurance?
Long-term care expenses are an inevitable part of retirement and must be planned for just like other essentials like health care, food, and transportation. One piece of advice we can give is to factor in the cost of long-term care as part of your total retirement strategy.
Anyone as young as 30 can get insurance coverage. People in their thirties are only starting to save for retirement and likely have other concerns, so long-term care insurance may not be a top priority.
Buying long-term care insurance in your thirties is great if you can afford it, but we’ve found that the “sweet spot” is in your forties or fifties. Lowered odds of being turned down owing to your health make premiums appealing.
In addition, you are more likely to be able to afford the long-term care insurance premiums once you reach retirement age due to your increased financial stability and more defined plans for the future. There is no need to worry about being uninsured for long-term care because coverage is typically available up to age 79.
But keep in mind that the cost of insurance and the likelihood of being turned down for coverage both rise sharply with each passing year of life. Only 16% of applicants aged 49 and under were denied coverage in recent research (opens in new tab) by The American Association for Long-Term Care Insurance. Those between the ages of 60 and 64 saw a rise to 24%, and those 70 and older saw a surge to 44%.
Working with a registered agent to compare rates and apply for long-term care insurance is a must. Like any other type of insurance, it’s preferable to consult an impartial third party who can help you compare prices and coverages among providers.
When comparing plans, ask your agent the following questions in addition to the obvious “headline premium:”
What level of coverage is appropriate for your needs and budget?
Which of the policies you’re looking into has the most nuanced coverage?
What do the expenses and advantages look like for you in various scenarios?
While purchasing insurance, it’s important to know if the insurer is stable financially.
When choosing insurance, these are crucial considerations. It’s not enough to focus on the monthly premium; you need to consider the policy as a whole to ensure you’re getting the correct amount of coverage.