Prepare to Go the Distance

(ARA) - Striking a balance between financial resources and lifestyle goals is often challenging. If you’ve spent any amount of time on financial planning, you have undoubtedly faced the need to fund retirement savings, pay college expenses or insurance premiums, while also maintaining a lifestyle you and your family can enjoy. As you look down the road to retirement, one issue you may not have considered is the need for Long Term Care Insurance (LTCi).

Baby boomers grapple with many critical questions and financial considerations as retirement looms, according to “Fourth Pillar: Retirement Choices,” a recent white paper issued by Prudential Financial. Decisions like when and where to retire, whether to keep working, how to provide for dependents and transfer wealth, and when to draw Social Security can all seem pressing.

With so much to think about, it’s easy to see how LTCi might fall to the bottom of the priority list. Yet statistics show, given current life expectancies, many of us will need some type of skilled care at some point in the future.

“America’s elderly population now exceeds 35 million and will increase dramatically in the next 15 years, with more than half of those seniors needing some type of skilled care,” says Andy Mako, senior vice president of The Prudential Insurance Company of America’s Long-Term Care Insurance business. “It is of great concern that many Americans are not fully aware of the costs of care, underestimate the risk of needing assistance, or often have misconceptions about who will pay for their care.”

If you are like many people, you may assume your health insurance will pay for skilled care. Or that Medicare or Medicaid will kick in should the need arise. Unfortunately, these imagined safety nets do not apply to LTC and the reality is your own savings and assets will most likely be used to cover expenses. When you consider that the average two-or three-year stay in a nursing home can run as high as $185,000, according to Prudential’s 2006 Long-Term Care Cost of Care Study, it’s easy to see how those savings and assets could be quickly depleted.

What LTCi Covers – and what it does not:

Many people automatically think of nursing homes when they think of long-term care, but people with policies purchased their coverage to help them receive care and stay in their own home for as long as possible. In addition to nursing homes and care in your home, long-term care insurance can also pay for care in assisted living facilities and adult day care.

Some long-term care insurance policies even offer a “cash” benefit where the qualified claimant actually receives a monthly payment to do with as she pleases. This “cash” can be used to pay for informal care in the home, unpaid medical expenses, prescriptions or anything you want. A new trend in policies is the combination of traditional reimbursement for qualified care with a cash component that can be elected on a monthly basis. This type of “cash alternative” benefit provides a large degree of flexibility at claim time.

One thing almost all near-retirees have in common is a desire for freedom-of-choice during retirement. LTC coverage can give you greater control over how you spend your golden years. As with any insurance purchase, you should speak with a qualified financial advisor to see if LTCi is right for you. The good news is the costs of the policy are probably less than you imagine, but the peace of mind you gain will be priceless.

To learn more about long term care insurance, visit www.NEEDURL.com or call FILL IN PHONE.

Courtesy of ARAcontent