July 18, 2022
Long-term care in retirement can be quite expensive.
Chances are, when you think of saving for your golden years, you think of some fun things — like traveling — and some not-so-fun things, like the cost of prescriptions. However, if you’re not planning for long-term care expenses, you are likely in for some trouble.
According to a recent report, the average cost for a semi-private nursing home room is $94,900 per year. The average cost for a private room is a whopping $108,405 per year. If you don’t budget for at least some of those costs, you could end up depleting your savings on long-term care alone. This is the part where you think “I’m fairly healthy. I bet I won’t need long-term care.” Well, think again. A recent study found that a person who turns 65 this year has almost a 70 percent chance of needing long-term care at some point in their life. That means you need to face reality. There’s a good chance you’ll need long-term care and therefore, you need to figure out how you’ll pay for it. As USA Today notes, there are three main methods:
Pay out of pocket.
This is the hardest route, as it will take lots of planning and even more saving.
Long-term care insurance.
This can be a good option, just make sure you buy in when you’re young so you avoid premiums becoming expensive. Also make sure the policy is comprehensive so that your long-term care is covered.
Medicaid is a good choice, as it covers long-term care. However, it takes a lot of effort and cutting through red tape to get there.
Your best option for long-term care costs might be combining one or two of those methods. Whatever you do, just make sure to get started now.
This article was originally posted on savvymoney.com
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