Long-Term Care Cost-Saving Strategies | Tips from our Advisors
When a loved one needs care, it may seem like you must put your world on pause to ensure they get the proper help they need. It is crucial that you don’t. Long-term care is an important consideration for many individuals and families when planning for the future. Today's 65-year-olds have a nearly 70% chance of requiring long-term care services and support at some point.3 By taking a proactive approach, you can ensure that you and your loved ones receive the necessary care while maintaining financial stability. Here are four key points to consider when planning for long-term care:
Have an income plan
Creating a comprehensive financial plan is essential when you are a long-term care provider. You may be extremely committed to giving care and feel like you should no longer work as it is not your main focus. However, it is best if you can maintain some earnings. This will help preserve your Social Security benefits, retirement savings, and any other income that you rely on to pay bills or to stay afloat.
When figuring out funding for your loved ones’ care, start by assessing guaranteed sources of income that could come from Social Security benefits or pensions. These funds can help create a foundation for your financial plan, however, they may not cover all costs entirely. For residual expenses, consider obtaining long-term care insurance. While premiums of these policies can be costly, their coverage can significantly alleviate some payments. You should also investigate your loved one’s retirement accounts and investments. Strategic withdrawals from these accounts can act as supplemental income.
more information on Social Security benefits
Understand your resources and educate yourself
Familiarize yourself with Medicaid eligibility requirements and coverage options in your state. While Medicaid can cover long-term care costs, it typically only provides coverage once all personal resources are spent. It also may be helpful to research local care options. Investigate the costs and services offered by nursing homes, assisted living facilities, and home care providers in your area. This information can help you make informed decisions about future care arrangements and choose the best care plan for you and your family.
Gain control and protect your loved one’s finances.
Protecting assets and maintaining control over finances is crucial when planning for long-term care. One of the first steps you should take is establishing a Power of Attorney. Designate a trusted individual to make financial decisions on behalf of your loved one if they become incapacitated. This can help ensure their wishes are carried out and their finances are managed responsibly. Consider setting up a trust to protect assets and provide for long-term care needs. Trusts can often provide more flexibility than a simple will. Lastly, make sure all beneficiaries are accurate and up to date on retirement accounts, life insurance policies, and other assets to ensure they align with your long-term care plans
Remember to care for yourself
While it’s important to plan for the financial changes of becoming a caregiver, it’s important to consider the emotional changes as well. Being a caregiver can be hugely rewarding but can also take a toll on your mental health. A lot of times, especially in families, one person ends up being the main caretaker and takes on most of the care burden. It’s important to remember to make sure you are taking care of yourself too. Do your best not to neglect your well-being. When you are able, delegate care tasks to others in your family or investigate utilizing respite care services.
Take time this month to think through a plan for caring for loved ones. It’s important to not lose sight of what is in your best interest when looking out for someone else’s. Remember that long-term care needs can change over time, so it's important to regularly review and adjust your plans as necessary. We are always here to help, talk to an advisor today for assistance in creating your income plan and to explore all your options to ensure you and your loved ones receive proper care.
more information about Long-term Care Find an advisoR that can help
- https://www.principal.com/individuals/build-your-knowledge/start-planning-now-4-options-pay-nursing-home-costs
- https://getcarefull.com/articles/how-family-caregivers-can-get-help-managing-loved-ones-finances
- https://www.annuity.org/retirement/health-care-costs/long-term-care/statistics/