Katie Geery
Some of the biggest expenses individuals and families will incur throughout their lifetime are related to health care. As you age, the need to think about the costs that come along with living the life you envision for yourself becomes even more important. Planning for long-term care is not something that should be done on a whim, but with careful consideration for your wishes and potential needs. Some important questions to ask yourself are: Where do you want to receive care? And how do you want it covered?
As of 2023, the median annual cost of care in the Manchester, NH, area was $91,520 for home health aides, $87,300 for assisted living facilities, and $165,585 for a private room at a nursing home facility. Expenses such as these can become necessary if unexpected injury or illness occur, or throughout the normal aging process. Inevitably we will all incur health care–associated expenses during our lifetime and if the cost of care is not carefully planned for, you may not have as much autonomy to choose the type of care you receive or where you receive it.
The idea of “aging in place” has become more popular as many people choose to stay in the comfort of their homes for as long as possible, rather than enter a nursing facility. Often, this requires adjustments to be made to one’s home to ensure safe living conditions which can be a costly endeavor. There may also be the need for homemaker services, home health aides or even skilled nurses.
In many cases, family members assume the initial burden of care. In fact, according to a 2020 Morningstar report, 41.8 million people in the U.S. provide care in some form to a person over the age of 50, and 62% of those people have another job in addition to caregiving. Over time this can have significant impact on the caregiver’s life, finances, work commitments, and physical and emotional well-being. Though it is normal to want to have family members deeply involved with care, there are things you can do to reduce the caregiving burden.
While government programs like Medicare play a role in taking care of health care costs, there are limits to the amounts they are willing to pay for services. For example, Medicare will not pay for long-term care of any kind, including nursing home care, as they are not considered to be “medically necessary”.
Long-term care insurance may be something to consider as you think about your long-term goals. Purchasing a long-term care policy does not generally include a large initial payment, but rather ongoing premiums that can be worked into your financial plan.
Long-term care insurance can be used to assist in paying for services that better fit your needs and allow you to have more freedom when making decisions about care. It can often be used to pay for care at a facility, or at home, and there are various types of policies that can fit into differing lifestyles, budgets, wants and needs.
If you are considering your options and what aging-in-place may look like for you, the first step is to speak with your family about your expectations and wishes.
Next, talk to your financial advisor about your options and how things like long-term care insurance might fit into your overall financial plan.
If you’re interested in learning more and aren’t sure where to start, the in-house insurance specialists at Rise Private Wealth Management work alongside our advisors to help you look forward and plan for the future you envision. Give us a call today for a complimentary initial consultation.
Katie Geery, MBA, CFP, APMA, CRPC, is a private wealth advisor and certified financial planner practitioner with Rise Private Wealth Management, a private wealth advisory practice of Ameriprise Financial Services, LLC in Bedford, NH. She specializes in fee-based financial planning and asset management strategies and has been in practice for 6 years. She can be reached at Katie.Geery@ampf.com.
