Do You Need Long Term Care Insurance?

“For a couple turning 65, there is a 70% chance that one of them will need long-term care.” – Wall Street Journal

“60% of people over 75 need long term care. The average facility stay for older folks is about 3 years.” – Business Week

“Over 50% of all people entering a care situation are penniless within one year.” – Harvard University

Long Term Care Insurance provides income should you end up requiring extended care. Long terms care typically includes rehabilitative care, nursing care, personal and in-home health care.

Long Term Care Insurance protects you in the event you have to enter a long term care facility. It can also help should you ever require at home health care assistance.

The most popular type of long term care policy is one that provides income to you to provide for any type of long term care service. Other types of policies reimburse you for eligible expenses or pay a set daily amount for expenses.

How Much Insurance Do You Need?

How Much Insurance Do I Need?

This question requires careful consideration. First, ask yourself:
“If I died tomorrow, how much money would my family need?”

Insurance reduces risk and provides security for yourself and your family’s future. To know how much insurance you need, you’ll need to consider your lifestyle and what the possible risks are that could affect it. When calculating how much life insurance you need, consider the following:

  • Estate Expenses
  • Funeral Expenses
  • Mortgage
  • Loans and Debts
  • Replacing Annual Income (number of years?)
  • Children’s education
  • Resources available at death: Savings, Stocks, Mutual Funds, Retirement Funds, Life Insurance, and Other Assets

Life insurance is essential to many families, giving extra security if the unthinkable should happen. The loss of a breadwinner is devastating enough, without having the added stress of worrying about how to cover the bills and mortgage.

Other types of insurance are equally important. Life events such as illness, accidental injury, loss of employment income, or a death in the family can affect family security. Yet these potential risks to your lifestyle can be reduced by the right insurance planning.

Changes in lifestyle also determine the types and amount of insurance you need. The amount of life insurance that you have will likely change throughout your life, depending on your life circumstances. Some of these changes might be getting married, starting a family, changing jobs or preparing for unexpected events.

To meet modern trends, life insurance providers also offer to act as an investment vehicle, building up a sum of extra equity over the lifetime of the policy. This can be withdrawn or borrowed against, and usually offers a tax-free sum on retirement or death.

Deciding on an amount of life insurance you should have requires careful consideration. A Financial Planner can help you determine just how much insurance you need based on your age, your income, family circumstances and obligations, assets owned, and debts owed.