Protect Your Financial Future with Long-Term Care Planning

November 6, 2018

How Medical Professionals Can Protect Their Financial Future with Long-Term Care Planning Saving for retirement is all about planning for the future. You’re laying a foundation that will enable you to live out your retirement years the way you want without worry. Medical professionals, of all people, should be well aware of the possibility of needing long-term care later in life, as well as the high costs associated with it. Still, no one wants to think of themselves needing that level of care. As a result, it’s one component to retirement planning that often gets overlooked. Nevertheless, having a plan for long-term care — and how you will cover the costs — is an essential part of financial planning to protect the nest egg you’ve worked so hard to build. Why Plan for Long-Term Care Now? Some people avoid planning for long-term care in part because they expect family members to help out. According to Senior Housing News, caring for an aging loved one is a major challenge, but most caregivers surveyed reported that planning ahead would have reduced their burden and helped them save money. Giving your loved ones the confidence that you will be covered financially is one huge benefit of planning for long-term care now. In addition to costs, planning for long-term care also involves researching your options and communicating your preferences for care. Do you want to stay at home for as long as possible? Would that require making some important modifications so you can age at home safely? Carrying out these wishes requires planning for them now. When planning ahead, it’s important to assess your risk of needing long-term care. There is no formula for predicting what will happen, but factors such as your lifestyle and any hereditary illnesses can make a difference in your health as you age. While you can’t change your genetics, looking at these factors now gives you the opportunity to make changes to your diet and exercise routine that will reduce your risk of a serious illness or injury later on. At the same time, don’t overlook factors you can’t change. According to CNBC, women use long-term care more than men, which means preparing for this expense is especially important if you’re female. Knowing Your Options Before you can plan for costs, you need to know what types of care are available and the average length of time that most people need different levels of care. Then consider the costs you can anticipate and your options for covering them. Medical Expenses When thinking about long-term care expenses, don’t forget to factor in everyday medical expenses and the ways Medicare can help. Medicare doesn’t cover all aspects of long-term care needs, but it does help with those regular healthcare expenses and prescription drugs. If you’re already enrolled in Medicare, be sure to check whether any changes have been made to your current plan. The Medicare Annual Enrollment Period (AEP) is from October 15 to December 7, which means now is the time to make any changes if you plan to do so. Insurance Options While health insurance won’t cover the costs of long-term care, other insurance options can help, such as long-term care insurance. Because these policies cover the costs of care, they preserve your assets for your spouse or children. One potential downside is that you can typically only get a long-term care insurance policy before you reach retirement age or early in retirement. Another option is to get a hybrid policy that gives you long-term care benefits through a life insurance policy. Utilize All Options Some people choose to simply cover long-term care costs themselves. If you go this route, planning ahead can help you reduce costs. For example, long-term care costs vary by region, so it helps to research the average costs where you live. Explore all options for help as well, such as veterans benefits if you’re eligible, which cover many long-term care costs. Knowing your risk of needing long-term care is a key aspect of the planning process. Thinking through these factors now will prepare you for the possibilities you can expect later on. With the enormous impact that long-term care can have on your finances, you don’t want to run into these costs without having a good plan in place. Photo credit: Pixabay