This is another guest post from Joe Plemon. Joe now has a brand new blog Personal Finance By the Book. Be sure to check it out and subscribe today!
Q: Joe, my wife and I have been hearing about Long Term Care Insurance and wondering if we should buy it, but we just don’t know much about it. Can you help us out with some basics of what exactly this insurance is and what factors to consider before buying it?
A: Long Term Care Insurance (LTCI) is for anyone who has assets they want to protect should extended nursing care occur. Because the projected cost of nursing home care for the year 2020 is $175,000 annually, very few people are able to cash flow such costs, thus the need for the insurance. As you might expect, LTCI is not inexpensive. The following tips should help deciding if you should buy long term care insurance.
Wait until you are 60 years old.
The younger you are when you take out the policy, the lower your premium will be. However, it is very rare for anyone under 60 to need nursing home care, so don’t pay for coverage you don’t need. On the other hand, the longer you wait, the higher your premium will be so don’t procrastinate once you reach 60.
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