How to Lower the Cost of Long-Term Care

For many of us, end-of-life care is something we’ll need to think about, whether for a loved one or for ourselves in the future. In 2024, the U.S. Department of Health and Human Services (HHS) estimated that over half (about 56%) of adults turning 65 would eventually require long-term service and support during their lifetime, and statistically, that number keeps growing. Long-term care is clearly an important part of an aging society. And yet, the cost of long-term care can be daunting to think about.

One way to prepare for the cost of long-term care in advance is to consider long-term care insurance. A policy can help ease the cost of long-term care, lower the burden on dependents and decrease stress for everyone.

So, if you’re considering long-term care insurance or just thinking about how to make it affordable, here are some things to consider. To cover the spectrum of later life issues, like estate planning, reach out to Farm Bureau. 

What Is Long-Term Care Insurance?

Long-term care insurance is a type of policy that pays for you to have assistance with day-to-day tasks when you can no longer perform them yourself. This assistance could come in the form of a home health aide or other home health assistance, assisted living facilities, skilled nursing, hospice facilities or some combination of these. It’s important to purchase this policy before you need it — and the younger you are when you purchase it, the lower the premiums likely will be.

Tip: Anticipate Rising Rates

The cost of long-term care can be high, though it varies by region. The national average cost of a semi-private room in a nursing home is $112,420 annually. Considering inflation, costs are likely to increase in the future. 

Tip: Plan Ahead

In your 20s and 30s, there’s no need to stress about the cost of long-term care. During these decades, you’re building your financial stability and the foundation for your future.

But by the time you reach your 40s and 50s, you should start thinking about post-retirement coverage. This is when the discussion of long-term care insurance needs to be top of mind — when you’re in a position to allocate funds towards this type of care and able to convey your wishes to your family.

Tip: Ask the Right Questions

When it comes to long-term care, there are many factors to consider.

• Where you’ll live: What type of facility do you want? How long will you stay in your own home? If you’re unable to, where will you go? Will you opt for a nursing home, assisted living or senior living?   
• Your health: What are your healthcare needs, and how stable is your health likely to be based on your health history and habits? Be realistic about your healthcare needs, both the expected and the unexpected.
• Illness: What would happen if you became seriously ill? What would happen if you became disabled? Talk to your family and friends about your preferences.  
• Legal decisions: What legal decisions do you need to make? Discuss advance directives for medical care with your loved ones and your lawyer.
• Finances: What are your financial needs? What are your resources? How will you allocate them?

Tip: Understand Long-Term Care Insurance

Long-term care insurance operates like any other insurance. By planning for your needs now, you can decrease your chances of becoming uninsurable later, which can place a burden on the resources of you and your family. There are three important factors you need to consider. 

Factor 1: Age

The younger you are, the more likely you are to be in better health, which can lower your premium. Premiums become more expensive the longer you wait.

Factor 2: Spouse

Do you have a spouse who also wishes to be covered? If both you and your spouse are purchasing a long-term care policy, you may have the option of sharing it for additional coverage.

Factor 3: A Policy Made to Order

You can tailor your daily benefit. If your resources are such that you will be able to supplement your policy with other retirement income, you may be able to reduce your premium.

Tip: Supplement With Life Insurance

When weighing the costs of long-term care, consider your life insurance policy — or a rider on your life insurance policy — as a way to supplement your income later in life. While life insurance and riders do not replace long-term care or disability income insurance, they have the potential to help protect you financially later on. With Farm Bureau's Daily Living Rider, you can choose to receive a portion of your policy’s death benefit to help cover expenses if you become chronically ill or unable to care for yourself.¹

Making the Cost of Long-Term Care Insurance More Affordable

Discussing long-term care needs can be daunting, but it’s an important conversation to have. By planning ahead, you can enjoy the peace of mind that comes with knowing your wishes and priorities are taken care of. Reach out to Farm Bureau to have a conversation today.