Long-Term Care: Not If, but When

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Figures the U.S. Department of Health and Human Services show that nearly 70 percent of people turning age 65 will need long-term care at some point in their lives.

Yet, according to a study by the Associated Press–NORC Center for Public Affairs Research, only 54 percent of Americans age 40 and older have planned for long-term care.

It’s likely not a matter of if your clients will need long-term care—it’s a matter of when.

“As we age, the likelihood of needing long-term care services increases, so as our population ages, we will certainly see a burgeoning demand for long-term care services,” wrote Jamie Hopkins in a recent Forbes article titled “5 Long-Term Care Planning Lessons from ‘Willy Wonka and the Chocolate Factory.’”

The first step, Hopkins advised, is to talk to your clients and their families about what they want and what they can afford, then move toward developing a plan together.

According to FedSavvy Educational Solutions, clients have several options to fund long-term care expenses. Planning options for clients may include:

A traditional long-term care policy. This route may be expensive. InvestmentNews reported that as of 2016, rates were up as much as 126 percent since 2015.

A hybrid life and long-term care policy. These universal life policies typically have a chronic care rider.

Self-insuring. This option is often for people who haven’t planned and who are very wealthy.

Co-housing or communal living arrangements. This could include home sharing (renting out a room in their home) or living in a co-housing community where people share in the care and daily living tasks, such as grocery shopping or cleaning.

Qualifying for Medicaid. Some states have expanded Medicaid under the Affordable Care Act, so check your state’s income qualifications. Though stay up-to-date on the current health care debate.

“There is a real need to be prepared ahead of time,” Hopkins wrote in Forbes. “Failing to plan for the eventuality of long-term care leaves the financial security of a family completely up to chance.”

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Ana Trujillo Limón is associate editor of the Journal of Financial Planning and the editor of the FPA Practice Management Blog. Email her at alimon@onefpa.org. Follow her on Twitter at @AnaT_Edits.

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