This retirement expense has hit $100,000 annually — and it’s rising

Personal Finance


Though the topline figure for care costs can be daunting, soon-to-be retirees can help prepare by working with an advisor to draft a plan.

Questions you need to tackle from the outset include “Where and how would you like to receive care?” This can help you get an idea of whether you ought to anticipate the high cost of nursing home care or the more moderate cost of receiving home care.

Bear in mind that while you may want to spend the entirety of your retirement receiving affordable care at home, a change in your health could always lead you to an assisted living facility or a nursing home — where costs are higher.

You should also select trusted individuals to oversee your medical care and to make financial decisions for you, in the event you become incapacitated.

Discuss with your advisor whether a long-term care insurance policy or life insurance with a long-term care feature might be right for you.

Long-term care insurance policies have been sliding since about 2012. Back then, there were about 233,000 buyers, accounting for $550 million in premiums, according to data from LIMRA, an insurance industry association.

In comparison, there were 66,000 buyers of long-term care insurance and $176 million in premiums in 2017, LIMRA found.

Questions to consider on that front include “What’s your cash flow?” according to Thomas J. Henske, a certified financial planner and partner at Lenox Advisors.

“What’s the carrier’s ability to raise premiums on your long-term care coverage in the future?” he asked. “If it’s life insurance, what happens if either the dividend rate of the policy or the interest rate go down?”

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