Most of us will need long-term care for some period of time, but many people resist purchasing long-term care insurance because of the high cost of the annual premiums, which can run as high as $5,000. Of course, paying for long-term care out of your own pocket is vastly more expensive – hence the need for long-term care insurance.
Here are some ways you can save money on long-term care insurance:
Buy a short-term policy. Unless you have chronic health problems or a family history of health issues, you will likely not need a lifetime policy. A recent American Association of Long-Term Care Insurance study showed that only eight percent of Americans needed coverage for more than three years. You can save thousands in premiums if you buy a short-term policy.
Buy early. Long-term insurance premiums go up as you get older, so the younger you are when you purchase your policy, the lower the premiums will be in general. Premiums can rise, however, even if you have a guaranteed renewable policy.
Shared care policy. If you and your spouse both want long-term care insurance, a shared care policy could provide more coverage for less money. A shared care policy gives you a pool of benefits to split with your spouse, so if you buy a 5-year shared policy, you will have a total of 10 years to share. If your spouse needs four years, you will have six years left.
Longer elimination period. Most policies have a 30-90-day waiting period before coverage kicks in. If you choose a longer elimination period, this can lower your premiums.
Daily benefit reduction. Choosing a lower daily benefit will get you lower premiums.
Protection from inflation. Inflation protection is usually recommended for all long-term care insurance policies, and increases the value of your benefit to keep pace with inflation. However, if you are over the age of 62, you can save by choosing simple interest rather than compound interest increases.
If you’d like to learn more about how we can help you with your long-term care and Medicaid planning, please contact us for your free initial consultation at one of our conveniently located offices in Fort Pierce, Stuart, Port St. Lucie, Vero Beach, and Okeechobee.