Long-Term Care Insurance is a Waste of Money

Thinking about getting long-term care insurance? You don’t want to miss this episode where Mike Ballew exposes the truth about long-term care insurance.

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Music Credits: YouTube Audio Library
Summer of 1984 by RKVC

[dotted-]

I don’t agree with you. I’m mid-60s, single with no family. I have LTC plan I got at 59 and my monthly payment is going up significantly in 2024, but only to $114 per month for 3 years of coverage. To me it is well worth it since I have no family to care for me or to burden with taking care of me if something happens. Instead of saying it is a waste across the board, you should make the disclaimer that everybody’s circumstances are different and it may be beneficial in some cases…

[edhcb]

Mother and Father in law finally got to “cash in” on the long term insurance policy that they had paid on for endless years when my mother in law became sick and passed away. The amount of effort and hoops my father in law had to jump through to get reimbursed about $10k was crazy! 😂

[diane.moore-]

How do people manage in retirement since 401ks are nothing to write home about? Inflation has skyrocketed My 600k turned to 350k in no time. I'm 61, won't one work till they die at this pace?

[ivanvarykino]

Totally agree on this. Long term care insurance is like buying a product warranty on yourself. Not likely you'll need it and if you do you'll be told your issue isn't covered.
Self insure is the way to go!

[richardt]

I have worked in healthcare as a psychologist for 40 years. I works with patients of all ages. I talked to a lot of middle aged and senior adults and long term care was an issue for many, especially for those who were single with no children. I talked to a number who paid a fortune into long term care but were priced out as premium rose to over $1000 a month. As you said, some were denied coverage when they needed it, some insurance companies went bankrupt. After seeing how things were working out for my patients, I decided to self insure. Basically, my 401K, ROTH, and waiting to 70 to collect social security will provide for my living expenses on my own, in assisted living or a nursing home. I am using straight Medicare with an AARP supplemental plan and Humana drug plan.

[BREEZEMAYES]

My brother bought this in early 90s when the rate was guaranteed not to increase when he was healthy early 50s.
He was diagnosed with Alzheimer's at age 61. He showed signs in late 50s. It was a life saver for him and his wife.
This guaranteed one price was discontinued for new policies but it remained for him & those that purchased then.
The insurance paid for aid 8 hrs a day at home for more than a decade & his care at nursing home for almost 7 years. They lost money on those early policies but for those fortunate to have purchased back then it was a good deal. He was thought of as a good risk because my parents were in their mid 70s with minimal health issues.

[romeysiamese]

Thanks Mike. You are a voice of reason. My mother died at home w hospice help. I cared for her. This should be the way if possible.

[bobcorio]

My mother bought a LTP at age 60, at age 72 diagnosed with dementia. Her policy was a lifetime policy. We were so lucky that she had the policy that paid for her lifetime stay she finally passed away at 92. So I am a big promoter of long term policy. Her total cost of stay was $772, 000 for 20 years of stay. She did have to sell her house and we used her social security plus the long term insurance policy to pay that amount.

[OroborusFMA]

My parents took out long term care insurance in the early 1990s before the insurance companies knew what they were getting into. My father had dementia. The money we got over his final two and a half years easily exceeded what they paid the insurance company for a couple of decades. Now, today, it may well be true because the companies got wise and raised the cost considerably. Another option is to take out a whole life insurance policy with a rider that pays out the policy early if you need long term care.

[stephencullum]

I am retired and pretty much came to your conclusion two decades ago. With you having the money you control where and what type of care you get. In home care is the best option .Both my mother and mother in law at the end of their lives had nursing home care. Both were in for less than six months. One point you missed. If you own your home you can sell it to fund your nursing home cost or take out a reverse morgage. My aunt did that.

[trebonejones]

Most people considering LTC don't have 30 years to save and a 6% return on investment in this financial climate is laughable

[idamariarosenberg]

I have been concerned about this very issue, but I just came across your article here and I’m very thankful for you posting this. It puts my mind at ease now.

[gmorphan]

This helps confirm my thoughts on this subject...Thank You! But LOL! My 92 year old In-Laws just re-upped his LTC insurance policy for over $11, 000 this year. I then find out about all the restrictions, you need to check 3 of 10 boxes before it kicks in, then it only pays up to a certain amount per day. They're still living at home, more than likely any stay in care will be short. I can only imagine how much money they spent over all those years... I'll take my chances without it.

[jdraven]

Thank you for confirming that my mom did the right thing. She followed the common wisdom and paid for LTC for years - recently they wanted to raise the rates significantly so she stopped paying. A CPA friend told her likely her claim would be rejected if she ever tried to use it anyway.

Someone I know tried to get me to start payments on LTC when I turned 50. They uses the same scare tactics. The rates were so ridiculous I couldn't even consider it.

[gbinman]

I appreciate your analysis. I decided against LTC based on my financial situation. I have a defined benefit pension. LTC is a one way street, so I wouldn't need my home or other assets.

[PetesProjects]

Thanks for making this so simple. The facts and nothing but the facts. Well done.

[Zues]

Yup, all true on LTc. I dropped mine after 2 years when my premium nearly doubled due to "unexpected claim costs within the group". What a scam.

[johnmckinney]

My Dad paid for this for years and years and when he needed it, they didn't pay a dime. They found some technical thing to get out of any kind of help. Pure rip off.

[MoneySavingVideos]

Mike, if you self insure, what happens after your money runs out? Will the nursing home wheel you out to the homeless camp?

[larkc]

My experience with insurance companies is they are always there to sell you the policy but then don’t want to pay any claims. We looked at LTC insurance 20 years ago and decided against it because of the cost.