Long-term care, man…it’s no joke. Like, seriously, it can cost well over $100,000, and a lot of folks out there are just not ready for it. Carolyn McClanahan, a doctor and financial planner from Jacksonville, Florida, is like, “People just don’t plan for this stuff ahead of time, you know? It’s a huge problem.”
According to a report from the U.S. Department of Health and Human Services and the Urban Institute, over half of Americans who hit 65 today will end up needing some serious long-term care. And we’re talking about disabilities that can really mess you up, like dementia, Alzheimer’s, Parkinson’s, or the aftermath of a stroke. The average cost for care for someone turning 65 now is around $122,400, but some people end up needing care for years, racking up costs in the hundreds of thousands. And let’s be real, that kind of money is just out of reach for a lot of folks.
So, where’s the cash gonna come from? Many workers just don’t have that kind of dough stashed away for retirement or in their savings accounts. And let’s not even get started on long-term care insurance – most people don’t have that either. Bridget Bearden, a strategist at the Employee Benefit Research Institute, is like, “It’s pretty clear that folks aren’t exactly rolling in the dough they need for this stuff.”
But wait, there’s more. The cost of long-term care can vary a ton depending on where you live and the type of care you need. On a national level, it’s about $6,300 a month for a home health aide and $9,700 for a private room in a nursing home. And get this, many households aren’t even aware of how much this care can cost, whether it’s for themselves or their loved ones. Like, 73% of workers think they might have to care for someone in the future, but only 29% of them have actually thought about the costs. And of those who did, 37% thought it would be under $25,000 a year. Yeah, good luck with that.
Now, let’s talk insurance. Health insurance? Nope. Medicare? Not really. They might cover some stuff, but when it comes to the nitty-gritty of long-term care, you’re pretty much on your own. And Medicaid? Yeah, it’s the biggest payer for long-term care costs, but you gotta be pretty much broke to qualify. And with the possibility of Medicaid cuts on the horizon, well, things aren’t looking too hot.
So, what’s the deal with long-term care insurance? Only about 7.5 million Americans had it in 2020, which is like a drop in the bucket compared to the number of baby boomers retiring every year. Some states have public insurance programs, and traditional policies can be crazy expensive. McClanahan suggests going for a hybrid policy that combines life insurance and long-term care benefits – it’s like killing two birds with one stone. And hey, if you’re considering insurance, make sure you know how the benefits work. Reimbursement policies? Indemnity policies? Yeah, it’s a whole thing.
But honestly, the best way to deal with long-term care costs is to plan ahead. Like, way ahead. Think about who’s gonna take care of you, how you’re gonna pay for stuff, and what kind of care you want. And, like, do you wanna stay in your own home or move somewhere cheaper? Because let’s face it, long-term care is unpredictable and can drain your bank account real quick. So, be proactive, people. It’ll save you a whole lotta money in the long run.
