One of the biggest fears older Americans have is becoming a “burden” on their loved ones later in life. They do not want to place financial strain on their children, siblings, or other relatives. This is why it is so important to have a plan in place for long term care before you actually need it.

Understanding the Cost Associated with Long-Term Care

Most Americans dramatically underestimate the cost of in-home long-term care. In fact, a recent survey by Genworth discovered that people underestimate the cost of this care by almost 50 percent, according to Many Americans believe home health care costs are below $450 per month. In reality, the cost of long-term care is closer to $4,000 per month for an in-home aide.

You may be thinking, “Ok, that’s a big expense if you go with an in-home nurse or aid. But what about nursing home care?” Well, those costs are equally staggering. For example, the estimated cost for a private room in a long-term care facility is roughly $90,500 per year, according to MetLife.

Paying for Long-Term Care

Do not put your faith in Medicare or Social Security to cover the cost of long-term care. In fact, there are generally only three ways to effectively cover the full cost of long-term care – (1) personal savings, (2) Medicaid, and/or (3) long-term care insurance.

For most people, the best strategy to ensure your long-term care costs are covered is purchasing a long- term care insurance policy. If you have a policy, it gives you the freedom to choose to receive in-home care or care at a nursing home or other facility. The key is to not wait too long to purchase long-term care insurance. The optimal age to purchase this type of insurance is in your mid-50s, according to the American Association for Long-Term Care Insurance.

If you are planning to utilize Medicaid to cover long-term care expenses, it is important to understand that you will need to spend down your retirement assets and basically become destitute in order to qualify for coverage.

Experienced Renton Estate Planning Lawyer Here to Help

If you need assistance coming up with a plan for your long-term care, schedule a meeting with the Law Offices of Dan Kellogg PLLC. For more than four decades, Dan Kellogg has been practicing law throughout King County and Washington. His legal team is ready and able to help.