In Your 50s? It’s Time to Start Planning for Long-Term Care

Now that you’re in your 50s, you’re thinking seriously about retirement. You’re counting up your savings, making catch-up contributions and planning what the next chapter of your life will look like. However, if you’re not factoring long-term care into your retirement planning, you’re making a costly mistake.

According to AARP, the average lifetime cost of long-term care is $172,000 and rising. That’s less than the average person nearing retirement has saved in total. This means the average retiree is wholly unprepared for the cost of long-term care, despite their likelihood of needing it. As Forbes reports, nearly 70 percent of all seniors will require long-term care.

Incidence of Long-Term Care

If you’re healthy and have good habits in your 50s, you may not need long-term care in the future. Many disabling health conditions are preventable through lifestyle choices like remaining physically active, eating well, and caring for your mental health. However, even the fittest of seniors can end up needing care because of an accident, communicable illness, or non-preventable health condition. In addition, these factors increase your risk of needing long-term care:

  • Lifespan: Older adults have a higher incidence of disability. The longer you live, the more likely it is that you’ll require long-term care.
  • Sex: About 79 percent of women over 65 will require long-term care, compared to about 58 percent of men. This is in large part because women live longer than men and are more likely to be widowed and require outside help.
  • Family history: Family history increases your risk of a number of serious health conditions.

Since not all types of disease or disability are preventable, seniors should prepare for long-term care, even if their risk is low.

Financing Long-Term Care

Outside of unpaid care from family, long-term care services are expensive. These are average costs for common long-term care solutions:

  • Nursing home (private room): $8,121 per month
  • Nursing home (shared room): $7,148 per month
  • Assisted living: $3,750 per month
  • Adult day care: $1,517 per month
  • In-home care: $4,099 per month

As you can see, long-term care is costly. While you may be able to manage a few months of long-term care services out-of-pocket, financing care for a year or longer could threaten your financial security. That’s why it’s so important to plan ahead to pay for it. Seniors must rely on the following options to finance care:

  • Private Pay: Paying cash means you only pay for care when and if you need it. However, if your care needs are high and you run out of money, you’ll be faced with spending down your assets to qualify for Medicaid. This could put significant financial strain on your family, especially if you haven’t already set aside funds for funeral expenses through a Totten trust, insurance policy, or prepaid funeral arrangements.
  • Long-Term Care Insurance: Long-term care insurance protects seniors from the full cost of long-term care. However, premiums can be costly, and insurers may deny individuals with preexisting conditions. Seniors wary of losing money to premiums can opt for a hybrid policy that combines long-term care and life insurance.
  • Health Savings Accounts: Adults who have funds in an HSA can use them tax-free to finance long-term care expenses, including long-term care insurance premiums.
  • Supplemental Medicare plans: While Medicare doesn’t do a lot to cover the cost of long-term care on its own, signing up for a supplemental plan can help with expenses related to ongoing healthcare needs, including vision and dental care and even physical fitness programs. Before you sign up for a plan, know what kind of coverage you’re eligible for based on the state you live in, and know that the Open Enrollment Period for Medicare plans runs from October 15 to December 7 of every year.
  • Medicaid: Medicaid covers certain long-term care expenses for low-income adults. However, a senior’s countable assets must value less than $2,000 to qualify for Medicaid.

Not accounting for long-term care expenses is one of the biggest mistakes you can make when planning for retirement. Thankfully, there’s still time to plan. Whether you start socking away extra money, shopping for insurance policies, or making other plans for long-term care, taking action today will save you strife tomorrow.


June is the co-creator of Rise Up for Caregivers, which offers support for family members and friends who have taken on the responsibility of caring for their loved ones. She is author of the upcoming book, The Complete Guide to Caregiving: A Daily Companion for New Senior Caregivers.

Image via Unsplash

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