The longer we live, the more likely it is that we will eventually need assistance with our daily activities and care. Statistics show that 70% of Americans turning 65 will need some form of long-term care in their lifetime.1 For some, care will be provided at home. For others, it will mean assisted living or nursing home care. With nursing home costs averaging up to $109,628 a year2 for a semi-private room, and inflation that typically outpaces the general economy, future cost of care can be projected to reach much higher for an individual. Many mistakenly believe these costs will be covered by their health insurance or absorbed by Medicare. That is just not the case. Further, to qualify for Medicaid coverage, you must first spend down your liquid assets. Others believe the cost of covering this risk is too great or that the coverage purchased will fail to pay when it should. As with all aspects of retirement risk planning, it’s important to become informed and utilize the assistance of an experienced advisor to make the best decision possible.
Nye Wealth Management can assist you and your family with long-term care planning. An important aspect of this planning is determining just how much of the risk should be transferred and by what means. The cost to transfer long-term care risk is directly tied to age and health of the applicant. Therefore, the sooner you act, the more cost-efficient that transfer will be.
Preparing and planning for a long-term illness now will also alleviate the stress of having to someday spend down much, if not all, of your assets. While it’s a topic many prefer to avoid, it’s one on which you must at least get informed.
1Mark Strassmann, Samthan M. Wender. March 17, 2025. “Most aging Americans will need long-term care in their lifetime. Loved ones often take on the labor and costs.”
https://www.cbsnews.com/news/aging-americans-long-term-care-families-labor-costs/. Accessed May 19, 2025.
2Nationwide Financial. “Compare long-term care costs from state to state.” https://nationwidefinancialltcmap.hvsfinancial.com/. Accessed May 19, 2025.