Should I buy long-term care insurance after 50?
When It Makes Sense
Long-term care insurance can help cover costs for nursing homes, assisted living, or in-home care, which Medicare generally does not cover. If you have significant assets to protect and want to avoid spending them down on care, insurance can be a good option. Premiums are lower if you buy in your 50s or early 60s, but you'll pay for many years before needing care.
However, insurers have raised premiums on older policies, and some have exited the market. You need to be confident you can afford the premiums now and in the future. Also, consider that you may never need long-term care, or you might prefer to pay out of pocket.
Alternatives and Considerations
If you have a large retirement portfolio, you might self-insure by setting aside a portion for potential care costs. Hybrid policies that combine life insurance with long-term care benefits are another option; they guarantee a death benefit if you never need care, but they are more expensive.
Before buying, compare policies carefully. Look at the daily benefit amount, elimination period (how long before benefits start), inflation protection, and the insurer's financial strength. Consult a financial advisor who specializes in elder care.
- Assess your risk: family history, health, and assets.
- Compare policies from highly-rated insurers.
- Consider a hybrid life/LTC policy if you want a death benefit.
- Check if your state offers a partnership program that protects assets.
- Review premiums and ensure they fit your budget long-term.
Common mistakes
- Buying a policy without understanding the elimination period and benefit triggers.
- Assuming Medicare or health insurance will cover long-term care.
- Choosing the cheapest policy without considering inflation protection.
