Should I purchase Long Term Care Insurance?

Should I purchase Long Term Care Insurance?

Recently, a client asked this question. It is a subject I’ve researched over the years, but I reviewed the numbers again, and concluded the following:

  • Health care costs are unpredictable. They might be astronomical, or they might be minimal or non-existent should you die in an accident or should you die after a very brief illness.
  • If you wait until you are in your late 60s or 70s to purchase Long Term Care (LTC) insurance, it is extremely expensive. If you purchase it when you are younger, it is not as expensive, but when you factor in the time value of your money, it is still quite expensive.
  • Your stay in a Care Home might be two months, two years, or ten years.

Summary:

Long Term Care Insurance MAY pay out benefit.

Permanent Life Insurance WILL pay out the benefit.

While each of these are not inexpensive, it is 100% certain that the life insurance benefit will be paid out to either your spouse or your family.

My Conclusion:

Rather than purchasing Long Term Care Insurance, I recommend you purchase Permanent Life Insurance. I recommend Universal Life or Whole Life Insurance, not term insurance.

How Does This Help?

If you need assistance in your home, or need to go to a Care Home, you can deplete your investments knowing there still are funds for your survivor from the insurance. In addition, you could exhaust the proceeds of the sale of your home, knowing there are funds available to the surviving spouse, family members, or your favorite charity should you pass away.

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