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Mid-thirties, better to purchase long-term care insurance or

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adamjohnson
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Mid-thirties, better to purchase long-term care insurance or  Reply with quote  

Started a new job and they are asking me if I want to "buy up" long-term care insurance. The employer offers 3 years/$3,000 per month for free.

At age 37 my rates are relatively low. However I'm still wondering if it would be worth it. I could buy up, for example, life-time coverage of $3,000 per month with inflation protection for about $50/month.

From google searches the average age people enter nursing homes is 79. That's 42 years from now. At 7% returns I could have $150,000 in the bank by then with the same investment. My grandfather didn't move into an old folks home until he was 88. He paid the rent from his pension and savings for five years until he died.

Also, given the fact that 42 years is a long time, it seems highly unlikely the insurance company will keep the same rate over that period. (I don't even have much faith the same company will still exist in 42 years). If I invest the money myself I have control of what I'm paying in.

When searching for advice on the internet, most seem to say you should buy LTC insurance with religious fervor. It's hard to trust the advice out there.

Another wildcard I'm thinking about is the possibility that I'll need long-term care when I'm much younger, say from an accident or disability. In that case, lifetime coverage with inflation protection definitely WOULD be a winner, but it's a pretty small possibility.

What would you do?
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Last edited by adamjohnson on Fri Oct 21, 2016 3:30 am; edited 1 time in total
Post Thu Oct 20, 2016 7:06 am
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ken-do-nim
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I took a look at a nursing home near where I live. $350/day for a semi-private room x 31 days/month = $10,850/month. So ... $3000 per month isn't going to help that much is it? Am I understanding your coverage right?
Post Thu Oct 20, 2016 2:43 pm
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littleroc02us
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Why not look into long term disability through your employer or the free market to cover the what if you get hurt or disabled. Long Term care insurance is a very good benifit, but premiums have skyrockted due to the fact that these companies underestimated the costs associated with the elderly. I would wait until your mid 50's before you get Long Term Life Insurance.

Risk comes from not knowing what you're doing. (Warren Buffet)
Post Thu Oct 20, 2016 2:47 pm
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