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Should I purchase long-term care insurance, or invest the money to pay for my long-term care?

I'm 53 years old and I'm thinking of purchasing long-term care insurance but I'm not sure I'll use it. Should I invest the money instead to pay for my long-term care? How much should I invest? What are pros and cons?

Investing, Insurance, Long-Term Care Insurance
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September 2018


You’re in the perfect time to select your options for long-term care planning.  Here’s the simple fact: 3 out of 4 people age 65+ will need long-term care.  However, two groups of people may not need to buy a private LTC policy.  Those who have a net worth under $250k or above $2 million.  The first group who’s under $250k of net worth can quickly spend down their possessions to qualify for Medicaid.  The last group who have $2 million can afford to self-insure.  Thus, it’s the people whose net worth between the $250k and $2 million need to plan for that contingency.

Another factor to consider is if you have any intention to leave a legacy to your children.  With that goal, having a LTC insurance that’s partnered with your state can protect a portion of your asset to leave behind.

Lastly, given three options to choose from for the long-term care planning, you’re no longer limited to the only choice, a stand-along LTC policy.  It’s cheaper comparing to other two options, but the pitfall of “use-it-or-lose-it” has deterred many potential buyers.  The other two hybrid policies which link the LTC with life insurance or annuity may not lose your premium dollars, but require a hefty upfront funding, either one time or a five-, ten, or twenty-year periods.

My suggestion is to consult with a CFP® who handles LTC planning.  In my practice, I can get quotes from top-notch companies based on the criteria my clients set.  Experience in LTC and a wide selection are the keys to find the right LTC for you. Best!

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