A Quick Reference Guide to Planning and Paying for Long-Term Care
Planning for long-term care is a complicated conversation, which is why physicians and financial advisors alike encourage people to start sooner rather than later. If you wait until long-term care is needed, chances are you won’t have time to prepare. Planning for long-term care means you get a say in how you spend your golden years. It also means you have taken the time to prepare your finances, so there are fewer unexpected expenses that often pop up with providing care.
From making healthier life choices that reduce your need for care to looking into ways to get cash in hand when needed, you can make the complex planning process much simpler when you follow these tips for planning and paying for long-term care.
Anticipating long-term care needs
The choices you make today will influence the degree to which you’ll be in control of your future care. Planning for the various degrees of long-term care now may seem like jumping the gun, but the sooner you begin to plan, the better prepared you can be. Plus, planning now can save you a lot of money. Here’s what you need to consider when planning for long-term care:
- Reduce the risk of injury or onset of illness. Take a look around your home— do you have steep stairs, narrow hallways or slippery tile in your bathroom? Each year, nearly 1 in 3 seniors over the age of 65 will become injured due to a slip or a fall. Older adults can postpone or even eliminate the need for long-term care with sensible home modifications, regular exercise, a healthy diet and high quality sleep. From prolonging the onset of cognitive conditions like Alzheimer’s to keeping bones and joints healthy, how you manage your physical and mental health now means everything for your future.
- Talk with family and friends about your wishes. If decisions have to be made about an independent living, assisted living or in-home care, planning now means you have a say in the place where you receive care. If your goal is to remain independent in your home for as long as possible, be sure you start planning for what it takes to live independently and safely.
- Examine your family history. If you have a parent or sibling with a cognitive condition like dementia or Alzheimer’s, your risk increases substantially. With nearly 6 million people in the United States over the age of 65 suffering from Alzheimer’s disease, having a plan for long-term care can help you manage the progression of the illness. A family history of heart disease, cancer and osteoporosis can also impact whether or not you’ll need long-term care.
Planning isn’t just about how to anticipate the potential for long-term care, but also how to pay for it. There are many options for securing the cash you need for the care you want, but your chances are better if you start preparing now.
Paying for long-term care costs
The costs of long-term care can vary depending on the nature of your situation and how you to want to be cared for. For example, you may want to age in-home, but if you didn’t plan for the expenses of an in-home caregiver, moving to a facility may be your only option. Asking the right questions about your options now will help you scale your finances for the potential what-ifs. When you look at your financial horizon, consider:
- Purchasing Medicare Advantage plans. These supplemental plans give you the same coverage as Medicare (Parts A and B), but offer additional benefits for prescriptions, dental, vision, fitness services, caregiver support and a 24/7 nursing advice line.
- Considering a reverse mortgage. By borrowing money against the value you’ve accumulated in your home, you can have additional income to cover long-term care. There are pros and cons to a reverse mortgage: On the one hand, you get to keep the title of your home, but on the other hand, you lose equity. You also don’t have to have a stellar credit score to qualify, but someone else remaining in the home after you are gone will have to take on that debt.
- Downsizing your home. While it might be difficult to leave your home, especially if your children and grandchildren grew up there, moving into a smaller home gives you several opportunities to cover care. For starters, you’ll have some cash to stash from the sell of your home. In addition, by downsizing, you save money by paying fewer utilities and other bills.
Thinking about the possibility of long-term care can make anyone– of any age — feel anxious about the future. That’s why planning is so important. Take the time now to get peace of mind for the future.
June is the co-creator of Rise Up for Caregivers, which offers support for family members and friends who have taken on the responsibility of caring for their loved ones. She is author of the upcoming book, The Complete Guide to Caregiving: A Daily Companion for New Senior Caregivers.