Should you sign up for Employer Long-Term Care Benefits?

 In Ozarks Live, Financial Planning

Should you sign up for Employer Long-Term Care Benefits?

Around 40% of employers offer Long-Term Care Benefits.1  Is it offered at your company?  Should you sign up? It is a more complex decision then health, life or disability benefits.  When is the best time to buy it?  This post and video explain the advantages of an employer long-term care benefit.

To help understand when purchasing would be necessary, we need to understand what long-term care is. Long-term care is needed when a person is unable to perform daily activities on their own. This can be categorized as needing assistance in dealing with chronic trauma, long-term illness, or a severe cognitive impairment. The cause could be from a stroke, illness, chronic conditions, or Alzheimer’s disease to name a few.

The need for long-term care not only impacts you, but also your family and loved ones. It is not uncommon that we see a family member as a care taker. It is wonderful if you have a loved one able to help take care of you but they may need to set aside their own obligations leading to unnecessary stress.  Having long-term care benefits can help bring some normality back into both of your lives.

How do you plan to pay for long-term care?  At The Resource Center we offer comprehensive planning including long-term care coverage options.  There are several options based upon your situation and portfolio. Set-up an appointment for a free consultation, 417-882-1800.

Medicare traditionally pays for short-term care in a skilled nursing or rehabilitation facility following a qualified hospitalization, then a long-term care policy would provide coverage based on the terms of the policy. Medicaid coverage may be available depending on your income level and your state’s coverage. The average cost of assisted living in Southwest Missouri for 2017 was $3,780 a month.2  The typical resident in an assisted living facility is a female of 87 years old (typically women outlive men by about 7 years.) 3

Assisted living communities focus on the independence of the resident. They try to keep them involved and socially active with others. They also provide skilled caretakers which help to ease stress off a family members or caregivers.  They are significantly different from the classic retirement home. In an assisted living facility, along with the residents being independent, they are given the chance to be involved in volunteering, clubs or groups, classes, exercise, and more just depending on the location. Each facility is different but there are a lot of similarities in the day-to-day flow.

Statistically, the best age to start looking around or applying for long-term care insurance is in your mid-50’s, 4 before you are in need of assistance.  If you have assets you would like to protect from long-term care expenses -look further into the employer sponsored plan.  An employer plan may have less health requirements making coverage easier to attain. The best time to buy it is before you need it.

Advantages of Employer Long-term Care Benefits:

  • An employer long-term care benefits plan may have coverage options for a spouse or other family members.
  • The coverage may be transferable, You could take it with you when you switch jobs or retire.
  • Costs are often lower in a group plan and may not see as many premium increases.
  • Premiums may be tax deductible as a medical expense, if you are eligible to itemize un-reimbursed medical expenses.1

A very high percentage of people will need long-term care assistance in the future.  An insurance policy will help protect your retirement assets from being spent on the care costs.  Many people choose to self insure, with the plan to use their retirement assets for care.  For those who choose to purchase a long-term care policy, the premium of your insurance policy may rise to an un-affordable level.  In that case you may have to let the policy cancel- losing out on your benefits and the premium you have paid in.  

Many who are receiving long-term care now, are relying heavily on their personal assets, savings, and investments which can deplete very quickly. This is why when planning for long-term care, try to make your plan created with your employer/place of work as portable as possible, meaning you will be able to take it with you when you leave employment, creating valuable assets as you move into retirement.

A life insurance policy or annuity contract with a long-term care rider may be another option. While not a replacement for traditional long-term care insurance, these products can assist with the costs of long-term care should a need arise. Long-term care riders usually come with an additional premium requirement or fee. However, if you can afford to take on long-term care insurance at a younger age at work, it would likely be beneficial in the future.

Important things to remember about long term care insurance policies: 

  • Insurers sometimes offer discounts to applicants who are in good health
  • Premiums for long-term care insurance can be based on the age at which you apply
  • Costs may increase on your birthday

Making a decision to purchase a Long-Term Care Insurance Policy is an important and costly decision.  For a consultation please give us a call at 417-882-1800.

If you have any financial questions or would like more information on this topic, send us a message or give our office a call anytime at 417-882-1800, and make sure to tune into Bruce’s show next week or catch up on past episodes on our blog or YouTube channel

Additionally, if you would like to schedule an appointment with our advisor, Brue Porter, online please click this link to view his current schedule of availability.

Guarantees and protections provided by insurance products including annuities are backed by the financial strength and claims-paying ability of the issuing insurer.







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The information contained in this material is believed to be reliable, but accuracy and completeness cannot be guaranteed; it is not intended to be used as the sole basis for financial decisions.   

We are not permitted to offer, and no statement contained herein shall constitute, tax or legal advice.  Individuals are encouraged to consult with a qualified professional before making any decisions about their personal situation.  Our firm is not affiliated with the U. S. government or any governmental agency.  Investment advisory services offered only by duly registered individuals through AE Wealth Management, LLC (AEWM).  AEWM and The Resource Center are not affiliated companies. AW05182932


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