Frederick A. Fisher: Long-term care insurance: Don’t grow old without it |

Frederick A. Fisher: Long-term care insurance: Don’t grow old without it

Frederick A. Fisher
Frederick Fisher
Laura Mahaffy/ | The Union

In “Medicare And You 2018”, Medicare reported that 70% of Americans 65 or older will need long-term care in their lifetime.

With the average cost of a private room at a nursing home in California at $300 per day, and the average stay for non-Alzheimer’s patients at just over two years, many of us will have to come up with over $215K for care. For patients with Alzheimer’s, that cost could easily double.

Unlike auto and home insurance which are pretty much mandatory, long-term care insurance is still optional. However, if you look at it from a risk/reward standpoint, it should be the most desired insurance for Americans ages 50-70. In the 20-plus years that we have been offering long-term care insurance, the biggest hurdle to purchasing this valuable insurance is the cost. Fortunately, in the past few years, the numbers of options to purchase long-term care has increased. There are now products to fit almost any budget that will cover at least part of the risk.

Let’s consider the situation for two fictional couples: the Millers and Smiths.

Both couples are in their mid-50s and in good health. The Millers have a substantial net worth and a large amount of liquid investments. Their parents both lived long, healthy lives without needing any long-term care. Their biggest concern is to pass on assets to their heirs. A universal life policy with a long-term care rider is a life insurance policy that will pay for long-term care costs; should the insured die before they need long-term care, then it pays out like a life insurance policy. By using a portion of their liquid investments, the Millers converted $100,000 into $250,000 of death benefit and $400,000 of long-term care benefit.

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The Smiths’ perspective regarding long-term care is different than the Millers. Mrs. Smith’s father needed skilled nursing care in a long-term facility. With no insurance in place, the financial burden became overwhelming. The Smiths could not plan to rely on their savings to cover any potential long-term care costs, so we focused on finding the right insurance product to fit their budget and reduce the risk as much as possible. By utilizing a traditional-term long-term care insurance policy with a reasonable annual premium, the Smiths successfully protected nearly all of the $240 average daily cost.

The moral of the story? Get current information on the pros and cons of long-term care insurance relative to your specific circumstances. Research all the new options available. Long-term care insurance might be expensive. Being without long term care, can be devastating. Call us for a consultation and let’s check your needs before it is too late.

Frederick Fisher is a Registered Representative with, and Securities offered through LPL Financial, Member FINRA/SIPC.  Investment advice offered through Ostrofe Financial Consultants, Inc., a Registered Investment Advisor and separate entity from LPL Financial. For questions or suggestions, contact Frederick at (530) 273-4425, or, or visit  Branch address: 420 Sierra College Drive, Suite 200, Grass Valley.

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