Is Long-Term Care Insurance Worth It?
When you picture retirement, you probably think about travel, family time, and enjoying the freedom you’ve worked so hard for—not needing daily help with bathing, dressing, or mobility. But the reality is, about 70% of people over age 65 will need some form of long-term care, and those services aren’t cheap.
Long-term care (LTC) insurance is one way to prepare for that possibility—but is it worth the cost? The answer depends on your goals, your health history, your family situation, and your overall retirement plan.
What Is Long-Term Care Insurance?
Long-term care insurance helps cover the costs of care when you can no longer manage basic daily tasks on your own—things like bathing, eating, dressing, or moving around. This care might happen at home, in an assisted living facility, or at a nursing home.
Unlike standard health coverage, long-term care insurance isn’t about curing illness. It’s about managing the care that comes with aging, injury, or cognitive decline. Most government healthcare programs don’t cover this kind of extended support, which is where a dedicated policy can make a real difference.
What Does It Cover?
LTC insurance can help pay for:
In-home caregivers
Adult daycare or respite care
Assisted living facilities
Memory care for Alzheimer’s or dementia
Skilled nursing or rehabilitation care
Without insurance, these costs can add up quickly—easily exceeding $5,000 to $10,000 per month, depending on location and level of care.
Who Should Consider Long-Term Care Insurance?
LTC insurance isn’t right for everyone, but it’s especially worth considering if:
You want to protect your savings and assets from being drained by future care costs
You don’t want to burden your spouse or children with caregiving or financial stress
You’re between your late 40s and mid-60s and in reasonably good health
You have a family history of needing care due to chronic illness, mobility issues, or cognitive decline
You want the freedom to choose where and how you receive care
Pros and Cons of LTC Insurance
Pros:
Provides financial support when care is needed
Helps preserve your retirement income and savings
Eases emotional and financial strain on your loved ones
Offers flexibility in how and where you receive care
Cons:
Can be expensive, especially if you wait too long to purchase
Premiums may increase over time
Not everyone will need extensive long-term care
Policies can be complex—understanding waiting periods, benefit caps, and exclusions is key
Alternatives to Traditional LTC Insurance
If the cost of a standalone long-term care policy seems out of reach, there are alternatives:
Hybrid life insurance with long-term care riders: These policies offer long-term care benefits if needed and a death benefit if not used for care.
Annuities with care features: Some annuities include enhanced payouts if you need long-term care, helping you self-insure with predictable income.
Health savings accounts (HSAs): If you’re eligible, you can use HSA funds tax-free for qualified long-term care expenses in retirement.
Long-term care insurance isn’t about fear—it’s about freedom. Freedom to age with dignity, protect your retirement savings, and spare your family from difficult choices. If you’re unsure whether it’s the right fit for you, our retirement planners at Sound Retirement Solutions are here to help. Schedule a conversation today and take the next step toward peace of mind.
