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Everyday in this life, people make informed decisions that others disagree with or think are short-sighted. C'est la vie.
Maybe some people don't make enough money to pay for LTCI, or maybe it's not enough of a priority for them to SACRIFICE to pay for it. They look at their own situation regarding money, health, family history, odds of needing LTC (for whatever reason) -- and feel they are OK with not having the insurance.
Clearly, I (and others) have decided that right now -- for our own reasons -- not to get LTCI. Some posts not only discuss the issue, but seem to imply that NO informed person could POSSIBLY decide differently from THEM, and not get the insurance. Some people who have the insurance have even said IF their situation were different they wouldn't get it either.
My current earnings only go so far. And I have a lifestyle I want to live NOW, with that money. So no….I don NOT want to spend $225 a month on LTCI insurance. For now, I'll save that money on my own.
Personally, I feel insuranced-out. I have car insurance (required by law), homeowners insurance (required by mortgage), health insurance, disability insurance (both through work), and an umbrella policy. Enough with the insurance, already. As for LTCI, I have a plan, as of now at at 56 I have three year's worth of private pay money. Of course, if God forbid I was injured today, and needed total facility care I'd likely outlive my money. And even then that's only if I need total care, IF NONE of my siblings of friends can help with care and I have to pay someone to do EVERYTHING for me at home or in a facility.
Well that's just the way it would have to be. As I get closer to old age I'll make some other decisions regarding Medicaid planning -- and YES -- maybe LTCI, if I can still get it. If not -- OH WELL.
Some posters seem to imply that people who don't get LTCI are CRAZY not to -- well that's just their opinion. I don't say they're crazy for getting it. Why do they seem to need to imply that about me (and others who make a different decision from them)?
And BTW, those of you with group deals or other deals who seem to think others are crazy for not getting it….if you want to find me the insurance for the same premium you're paying, I'll gladly reconsider my decision. It's amazing how people paying waaay less that what OTHERS would have to pay, can have such strong opinions about how those people should spend their money.
and btw, those of you with group deals or other deals who seem to think others are crazy for not getting it….if you want to find me the insurance for the same premium you're paying, i'll gladly reconsider my decision. it's amazing how people paying waaay less that what others would have to pay, can have such strong opinions about how those people should spend their money.
“This massive, 83 percent premium increase will come as a shock to the more than 274,000 federal employees and annuitants and their spouses enrolled in the Federal Long Term Care Insurance Program (FLTCIP). They are now faced with difficult choices – pay substantially higher premiums; reduce coverage substantially; or, in the worst case scenario, drop the coverage some have paid into for more than 14 years,” said Thissen (National President of the National Active and Retired Federal Employees Association)."
I looked into LTC insurance a few years ago but decided it was best to self insure as I am single with no need to leave an inheritance and own a home that should fund a few years in assisted living or a nursing home.
selhars and GeoffD you both make good points and I for one applaud you both. Do not get me wrong here I think it is still a decent deal in some ways and a bad one in others too. You can invest those premiums and create that and more. But not everyone is comfortable with the swings and in some ways that swing could ruin the whole plan. That being said the whole point of the post was to get people to think about "what if". If you are single you bet your sweet bippie I ain't buying it. Married is another story. I could have health issues war related that could surface in the years to come. Yes I should be covered by the VA but if I can supplement the payments so that they don't take all of my pension and leave some for the wife that would be good. Again I am thinking on my circumstances. I know we are in different positions than many here.
Thanks for your input. No one should feel pressured to buy LTCi. On the flip side no one should feel pressured to not buy it either. You both said it correctly. It is about making the informed decision and applying it to your circumstances.
The flaw in this math is that if you had invested all those premiums in a low fee index fund like VOO for 30 years, you would have an enormous pile of money. There's a reason why insurance companies are profitable. The same math applies to whole life policies. If you sit down and do the math, you're way better off investing the money than making your insurance agent wealthy from the commission money.
Except that with whole life, someone will get the money at some point. It is still not as good as investing unless you pass away significantly earlier than expected, which is not a good plan in my book. But that is the big benefit.
Most LTCi policies have no cash surrender value - use it or lose it.
Married is another story. I could have health issues war related that could surface in the years to come. Yes I should be covered by the VA but if I can supplement the payments so that they don't take all of my pension and leave some for the wife that would be good. Again I am thinking on my circumstances.
I had to get up to speed on that in a hurry 13 months ago. My senile 88 year old stepfather had a major health event that put him in the ICU, an emergency operation my stepbrothers agreed to, followed by about a month in a nursing home. The guy had spent his millions down to just about zero and I had to quickly come up to speed on whether my mother's assets could be attached if he had a lengthy stay in the nursing home. Yep. Wiped out. The state would grab all but the last $100-ish thousand of her brokerage account if Medicaid started paying. He had served in the navy in WW II and had a Pacific combat theater notation on his discharge so I started chasing VA benefits. He died before his 90 days of Medicare nursing home coverage were used up but it certainly was an object lesson to me on how LTC worked.
I still haven't closed the loop on VA survivor benefits with my mom.
Probability of you needing long-term care — most of us will need it. But that fact is immaterial. A few days, weeks, or even months of long-term care isn’t dangerous to a well-prepared retirement. It’s when the term stretches into years that we need to be concerned. So it’s the average or probable length of long-term care that matters in your analysis. Not the probability.
Percent of people who do/don’t have LTCI — this is simply an appeal to your herd instinct. If LTCI is a bad value, does it matter if plenty of people have purchased it? If it’s a good value, would it matter if relatively few people have it? I advise doing the math and thinking through your own situation. Ignore what others are doing.
Elimination period — this is how long you must pay for care, before insurance kicks in. Other than for comparing specific policies, it’s immaterial. When analyzing LTCI, I’m interested in worst-case scenarios. Since elimination periods are typically measured in months, they don’t matter much compared to the worst long-term care scenarios — measured in years or decades. A typical 90-day elimination period will barely dent a well-funded retirement.
Cost of long-term care — insurance agents love to quote the cost of a private nursing home room in your location. The numbers are sure to shock. Price tags in excess of $80K/year are common. Yes, you need to know that long-term care is expensive, if you didn’t already. But that’s immaterial when evaluating the value of a LTCI policy. For starters, you must think about how long you are going to need that expensive care. Then you need to understand how these policies work: they pay a maximum dollar benefit, in exchange for your premium. Whether or not that is a good value, is unrelated to the magnitude of the risk you are insuring against. If I describe the terrible consequences of a major asteroid strike on earth, will you run out and build a survival bunker in your backyard? Probably not, because it’s a poor return on your money, given the risk.
But the first thing you quote from the article is misleading.
Quote:
Probability of you needing long-term care — most of us will need it.
Half of zero day elimination policies are not used. 65% of 90 day elimination policies (the most popular option) are never used. "Needing long term care" and being in a facility long enough to qualify for coverage can be two very different things.
Can someone who has started LTCi past the age of 65 please outline
- whether preexisting conditions are accepted
- what you pay in premiums per month (starting the policy past age 65)
- what exactly is your coverage - at what day does it kick in and for exactly how long and what it covers during that time
And... if someone has what they believe is a stellar plan from a company (not through their state), please if you would DM me the name of the company.
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…I mean the same insurance COVERAGE for the same premium
