Long-Term Care: The Movie

By: Max Valavanis, CFP®

Retirement is often hailed as the golden age of relaxation and leisure, but behind the scenes lies a potential plot twist of long-term care costs. Like your favorite film where the protagonists must face the maleficent villain, long-term care often can embody this trope for millions of retirees. So, grab your popcorn, and let’s explore how our main characters can plan to overcome the evil of long-term care expenses.

According to Genworth – you can picture them as our editors for this movie – long-term care expenses are rising, and probably won’t stop. For the Space Coast, they state the monthly cost of a nursing home facility to be a staggering $11,000! While many may not need this level of care, even assisted living costs have climbed to $4,900 monthly. Since 2000, these numbers exponentially rose by 141.4%, according to a survey from Senior Citizens League. How are our heroes supposed to save for long-term care when the target is moving farther and farther away?

Seniors often believe Medicare will help them pay these daunting costs. However, once a hundred days have passed, Medicare will wipe their hands and leave our characters to the wolves. One payment method in which millions of retirees pay their long-term care expenses is through Medicaid. This government program can cover the costs for those with limited income and expenses. While the eligibility will vary by state, many times the individual will have to spend down their assets to near zero qualify.

Unfortunately, for our protagonists Medicare and Medicaid will not pay for long-term care; therefore, they must seek another path. Many along this journey inevitably reach the question – is long-term care insurance worth it? While it will cover many – if not all – expenses associated with nursing homes, assisted living, and at-home services, it can be costly. Premiums for long-term care insurance vary based on factors such as age, health status, and coverage options. While premiums can be costly, they may pale in comparison to the out-of-pocket expenses associated with long-term care services.

Long-term care planning is integral to retirement planning. Not preparing for these services will and has crippled many seniors’ savings. By understanding the potential expenses involved, exploring funding options, and planning, retirees can mitigate the financial impact and potentially maintain their quality of life as they age. Our heroes in this film, found their necessary plan before it was too late, and I hope you as our reader will as well.

Max Valavanis, CFP® is a co-owner of ValaVanis Financial in downtown Melbourne and in Rockledge. Max specializes in lifetime income planning for Retirees while protecting principal. Max can be reached at 321- 956-7072.