Is Long Term Care Insurance a Good Investment?

Is Long Term Care Insurance worth it?

We've all heard the alarming statistics around how many retirees will need Long Term Care (LTC) on average.

Further, the costs of Long Term Care can be significant.

So it would make sense that we would buy insurance for this type of risk? In the same way we buy insurance for our home to protect against a house fire, right?

Well in this Wealth Wednesday, we explore Long Term Care statistics, explain the ROI of LTC insurance, and discuss different ways to protect against this risk.

#LongTermCareInsurance #RetirementIncomePlanning

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Always remember, "You Don't Need More Money; You Need a Better Plan"

[vmobile]

Semiprivate room is very disturbing when other snoring and other noise with visitors smells medical machines sounds .

[colleenconger]

It’s not just nursing homes that’s only 4% Most people get in-home care

[flowersfrom]

I can't thank you enough for taking this topic! I was trying to research it myself, but couldn't find the statistics. It all makes sense now!
Could you do a similar video about heathcare costs in different age groups for the purposes of buying health insurance, and in particular, ACA insurance.

[mikeflair]

I agree that the concept of self-insurance / invest is poorly understood...why do you think there are so many insurance companies offering annuities, LTC plans and life insurance? I LOVE liquidity and lack of rules and lack of fees - I am the BOSS! Instead of Medicare Gap Plans, I self-insure the 20% side. I have never believed in LTC, annuities or whole life insurance or extended warranties. IMO, the only insurance you need is physical, like health insurance, car insurance, property insurance, or camper/boat/motorcyle insurance. Term life insurance only as a young family man.

[billh]

Excellent video! Thank you Tony. This is the first LTC presentation I've agreed with. I'm 60 and decided to self insure from the beginning. I live a very modest lifestyle but make good money. I invest roughly half of my income in a 401k and a separate brokerage account and Roth IRA.

[takatsu]

I suspect a lot of people that need long term care are people who never took care of their health. I did the math, and I plan to self insure, but I'm also working on eating right and exercising.

[everetteborr]

Wow, you can self insure for any catastrophic event, but insurance is a hedge against a catastrophic event—just like life insurance or medical insurance.

[chezellis]

One thing I never see discussed is another option, although it takes money upfront and having planned it out and researched. Non-profit CCRCs (Continued Care Retirement Communities.) Unfortunately, we don't get to know how long we'll live and the 'well, I took care of my health' is not a guarantee. In my husband's grandmother's case, she went into one while independent at 86. As she got older and less able, she was moved to the assisted living building. In the final year of her life, she was moved to their skilled nursing section, where she died at 103 years old. While they aren't a fit for everyone, it might still help to have it on an alternatives to LTC list.

[gilliandale]

Very clear and helpful info and perspective -- much appreciated! Thank you. Figuring out exactly how much of the supposed "pool" of money in my LTC policy would likely actually ever come to me...and how it's limited in how much per day etc (with no inflation protection) gave me an entirely new way of looking at it. The insurance money would help, for sure, but perhaps not really a good way to use the money i'd spend on premiums.

[AyaSmith-rbhp]

Thank you for removing fear mode. I can never trust that.

[arthur]

Great video could you include source when you referring any graph or plot? So we can look thru those source thanks!

[baronvontollbooth]

Excellent presentation! Based on the information in this video (and other sources of information) I think I'll be better off in the long run taking the money I would have to pay for an LTC policy and investing it, probably in an index mutual fund. No elimination period and, very important, neither me nor my spouse having to deal with an insurance company to get them to pay up.

[colinplaisance]

PA is a unique example sense it’s the only state that allows third parties to sue. But yeah… he had to pay.

[tadrod]

medicare advantage and other supplement is helpful? for any long term care in the future?

[dmoon]

Really interesting as an arithmetic exercise, calculation of outlays and probabilistic returns, but is this really appropriate to treat transfer of risk as an investment? With the exception of permanent life insurance with cash value accumulation, insurance is generally not perceived as investment (no value enduring any market risk). CV life insurance is generally considered a savings product (again, no appreciable market risk). But back to the episode, am wondering if you happened to run any of those notional ROI calculations using longer elimination periods for lower premium, e.g. 1 yr elimination period for traditional LTC policies?

[philbiker]

@22:15 $3200 / year? I have an LTC policy that I got through work some years ago I pay $13/month or $156/year. Are there companies out there charging $267/month for a long term care policy? *confused*

[global]

If my parents live in a filial law state like Pennsylvania but I live in a different state, am I potentially liable still?

[dmoon]

20:57 I think the best would be a LTC qualifying event much sooner (say 5 yrs into your payments, vice 25 yrs in).

[dmoon]

31:49 an insurance carrier giving anything for free? Does Not Compute(tm). Lol. — more likely, the cost of the rider already baked in to all policies, whether customer selects it or not

[darwinjina]

Ok, so men tend to pass away quickly and women tend to linger a long time before passing, right? Could it be that the wife is actually helping the husband pass away sooner? ;) (Just joking)