RADNOR, PA, –
November 5, 2019 – Planning for long-term care needs has become an
increasingly important topic as the population ages and people are living
longer. While the effects of a life-changing health event could impact the
entire family, research released by Lincoln Financial Group during Long-Term
Care Awareness Month (November) shows that consumers don’t know the entire
truth about long-term care needs and planning. Lincoln is helping dispel some
common misconceptions.
“Proper planning
for potential long-term care needs in the future has never been more important”
said Heather Deichler, senior vice president of MoneyGuard Product Management,
Lincoln Financial Group. “While it can be a challenging and emotional topic to
think about and discuss, tackling it head-on and before care is needed can make
a big difference in the care one receives, the impact on loved ones and a
family’s financial security. Unfortunately, the realities of long-term care are
often misunderstood. Long-Term Care Awareness Month is a perfect time to bring
clarity to the topic and spark meaningful conversations between families and
financial professionals.”
Misconception 1:
Planning can wait
Financial
professionals believe age 50 is the ideal age to plan for long-term care, but
clients typically wait until age 651. With more than half of
Americans turning 65 projected to need some type of long-term care in the
future2, planning early can help avoid rushed and potentially
expensive decisions. Rates for long-term care services vary greatly depending
on the type of care and location with national annual averages ranging from
$49,920 for a full-time home health aide to $105,485 for a private room in a
nursing home3.
Planning early
while still healthy can also increase the likelihood of being approved for an
underwritten long-term care funding solution, and potentially make the policy
more affordable with greater care benefits and options.
Misconception 2:
You only need to talk with family to plan for long-term care
Lincoln research
finds that 60 percent of people have discussed long-term care with their
spouse, children, parents or friends4. That is good news,
considering that most long-term care events begin in the home with family or
friends providing the initial care. However, only 5 percent have consulted with
a financial professional about long-term care. The research also finds that 63
percent do not have any type of long-term care plan — informal or written4.
A thorough
long-term care plan should include conversations with both family and a
financial professional together and cover key elements, including:
·
Preferences for how and where care is received
·
The role of family in caregiving and decision making
·
The potential cost of care services and how they would be paid
for
·
How long-term care funding solutions may fit into the plan
Misconception 3:
There are few insurance options to help fund long-term care needs
Despite an
expanding private insurance market, which now includes several different types
of solutions, there is relatively low familiarity of any of the options among
consumers. With the low level of familiarity, it’s not surprising that 57
percent of those surveyed believe a long-term care solution is only beneficial
if you use it4 even though hybrid solutions, which are life
insurance or annuity products with long-term care riders, are designed to meet
multiple needs. When presented with different options, survey respondents were
significantly more likely to find hybrid life insurance products that combine
long-term care coverage if you need it, and a death benefit if care is not
needed, the most appealing.
“When it comes to
long-term care planning, there are a lot of decisions to consider. It is
essential to start planning early and have the right people in the discussion,”
said Bill Nash, senior vice president and head of distribution for MoneyGuard
solutions, Lincoln Financial Distributors. “Financial professionals can bring
expertise to the conversation and help families plan for aspects they may not
have considered or truly understood, such as the potential costs of long-term
care and their impact on retirement plans, what’s covered by Medicare and
Medicaid, or private insurance options. With understanding of these types of
topics, families and their loved ones can develop thorough plans to help
individuals age with dignity and independence.”
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