CNBC Your Money: “Making a plan to pay for long-term care: Insurance and other alternatives”
CNBC Your Money, June 12, 2024 — In today’s article by Stephanie Dhue, she explains that almost three-quarters — 70% — of people turning 65 will need long-term carein their lifetime, according to a report by the Urban Institute and the Department of Health and Human Services. How to pay for that care is worrisome for many families.
Stacey Hachenberg, 58, and her partner, Sharon Fleming, 53, have been caring for their parents for several years. Hachenberg’s father died in April after staying at an assisted living facility for two years. While she coordinated his care, the cost was covered by his savings, pension and veterans benefits.
“It took about a year to actually get those benefits,” Hachenberg said, even with the facility’s help navigating the Veterans Affairs application process. “Had we not had a tiny little bit of money in my father’s savings, we would have been in trouble,” she said.
Finding benefits to pay for care
Understanding what benefits you have or may qualify for is a critical part of planning for long-term care, financial advisors say. Figuring out where you want to receive long-term care, who will be your caregiver and how you’ll pay for the care should all be part of the planning process, said certified financial planner Marguerita Cheng, CEO and founder of Blue Ocean Global Wealth in Gaithersburg, Maryland.
“Long-term care insurance can be helpful because it allows you to transfer some of the risk,” said Cheng, who is a member of the CNBC Financial Advisor Council.
Long-term care insurance typically pays for care if you have a chronic illness, have dementia or a severe cognitive decline, or can’t do at least two out of six “activities of daily living” without assistance: bathing, dealing with incontinence, dressing, eating, getting on or off the toilet or getting in or out of a bed or chair.