Long Term Care: A Choice of Living with Dignity

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BY ANDREW STEWART

What is long term care insurance? It provides an income-style benefit if you become unable to care for yourself due to aging, an accident, illness or deteriorated mental abilities. The money is for you and your family to use as you wish. There is a mistaken impression that government programs will cover people’s long-term-care costs. A lot of people are unaware that they have this potential liability exposure ahead of them.

I remember having a conversation with a lady from church about her biggest worry of getting old. Out of all the things that I thought she was going to say for example, being bound to a walker or wheelchair, losing her memory, not having enough money; her biggest worry was being a burden to her children. The idea that her kids one day might have to help her bathe, provide toilet aid and clean her house frightened her the most.

It’s easy to take our ability to perform day-to-day activities for granted. These abilities can change quickly, especially as we age. The cost of long-term care should be an important consideration in anyone’s retirement planning. Planning for the last fifteen years of life is difficult for most to adjust to. On average Canadians are living longer, existing conditions could become more difficult to manage and new ones could emerge. The question is what type of care will you want? Most of us will enter retirement with a pretty good understanding of our current health and what it takes to manage it. But, as time goes on, everyone’s health changes; we gradually begin to spend more on our medical, physical and personal care needs. At the same time, we would like to stay home with family and friends as long as possible and opt for private home care if we can.  

We can’t underestimate the emotional, psychological and physical stress a caregiver goes through, whether that is a spouse or a child. Sometimes this could lead to them falling ill and now two people require care. A proactive solution is to have conversations as a family team so that there can be a plan for aging to make sure everyone’s wishes are respected. When you have the means you retain control and choice over your care options. The average need for long term care lasts three years. You could choose to self-fund by saving for it but it’s easy to underestimate yours and your spouse’s health needs, which could deplete your savings quicker than you thought. Long term care insurance is an option that could help protect your savings, manage your lifestyle and maintain your legacy plans.

You should consider long term care insurance coverage if: You’re concerned your income might not last for your lifetime if your health deteriorates and you have limited family or friends to help. You want the financial resources to help you choose the type and level of care that’s right for you if you have an accident or need substantial care later in life as you age. You want to protect your wealth and legacy from being eroded by the cost of care.

Long term care insurance can help you: Bring care into your home so that you do not need to downsize or move to a facility right away. Lessen the burden on care-givers by supporting your family financially if you are going to live with them if you need care. Manage your care and expenses if you have an unexpected severe accident, at any age, that results in your needing substantial assistance from a family member or care-giver.

A possible problem with the insurance route is it could be expensive when purchased in later years. The cost of coverage requires individuals or couples to often trade off some other very important things that they are allocating to, such as retirement savings or lifestyle. Part of the reason for the high cost of premiums is a lack of customers. Insurance carriers need younger people to purchase policies and many of them either don’t feel the urgency, or have other priorities, such as paying off a home or saving for retirement.

Whatever the care, the funding is your responsibility.

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