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Long-Term Care: What It Is and How to Be Prepared

Long-Term Care: What It Is and How to Be Prepared

January 18, 2023

When it comes to financial planning, it is common for people to think of managing and paying off debt, planning for retirement, investing, and perhaps creating financial goals and a strategy to pursue them. While these are indeed components of financial planning, there is also an aspect of preparing for life circumstances that may not even occur—an example of this is long-term care (LTC).

Most people don’t know what long-term care is until they or someone they love needs it. What is long-term care, and why should you care to plan for it if it may never be used? The idea behind long-term care planning is preparing for the worst and hoping for the best.

What is Long-Term Care?

Long-term care planning is an essential consideration for people of all ages. It is the process of planning for the type of care you may need if you become unable to care for yourself due to chronic illness, disability, or injury. LTC usually involves providing help with Activities of Daily Living (ADLs), which may include bathing, eating, dressing, toileting, and more. These services help people live as independently and safely as possible when they can no longer perform everyday activities independently. Long-term care can be provided in various settings, including in your home, an assisted living facility, or a nursing home.


Why would you plan for long-term care if you are unsure if you'll ever need it? In this regard, it is much better to be safe than sorry. For the vast majority, the costs of long-term care services often exceed what the average person can afford based on their income and other savings and resources. By working with a financial advisor to plan ahead, you may be able to save your assets, allowing for a greater likelihood of you being able to leave an estate to your loved ones. A life-changing event that leaves you less able to perform everyday tasks shouldn't derail all the critical planning, work, and investments you've made toward pursuing your financial goals.

In addition to the financial benefits, there are emotional and psychological benefits to you and your loved ones as well. By having a plan in place in the event that LTC is needed, you and your loved ones can make decisions that are best for everyone involved and consider more factors beyond just the financial aspect. You will experience less stress all around if you take the time now to prepare for long-term care.

Lastly, a significant benefit of long-term care planning is ensuring you can maintain your independence in as many ways as possible. When people fail to plan for long-term care, they frequently feel like they must resort to choosing a nursing home, since they are likely unfamiliar with other options available to them. By having your plan in place, you can ensure your needs and wants are met should you ever need to utilize long-term care services.


Planning for Long-Term Care

Now you know what long-term care is and how it is beneficial to plan for, but where do you get started? First, you should understand the types of long-term care services available and how they can be financed, as well as the likelihood of you needing long-term care.

            Long-Term Care Solutions & Costs

There is a plethora of long-term care solutions out there, but there are four common ones you might consider exploring first: assisted living facilities, skilled nursing facilities, continuing care retirement communities, and home/community-based services. Each of these options offers different levels of care, and your needs may change over time, and your level of care required may increase or decrease. It's also essential when thinking about your preferences for long-term care to consider your family and loved ones' thoughts as well, as this decision will also impact them.

The cost of the care will vary depending on the setting you choose, your geographical location, the level of care required and more. To calculate the estimated cost of care based on your specific circumstances, use this Cost of Care Survey tool by Genworth:


Paying for Long-Term Care

Often, people will rely on multiple payment sources to pay for long-term care, but some common ones are government programs, long-term care insurance, and Veterans’ benefits.

There are several government programs that provide help with long-term care-related costs, like Medicaid. This program covers the costs of some types of long-term care for people who have limited income and meet other eligibility requirements. Medicare, however, does not cover assisted living or long-term care. Keep in mind, the eligibility requirements for Medicaid vary by state, so be sure to understand the rules for your specific location.

There are many options for long-term care insurance, all of which cover a wide range of benefits in different settings in that a person may choose to receive care. This option is typically a good choice for younger, relatively healthy people with a low risk of needing long-term care soon. While nothing is guaranteed, it can be helpful to consider this option while your health is strong because the older you get, the more expensive it is due to age-related health problems.

Lastly, for some veterans, the U.S. Department of Veterans Affairs (VA) provides coverage for long-term care at a facility or at home. There are often waiting lists for VA nursing homes, so be sure to get in touch with the VA medical center near you if you or a family member is eligible for these benefits


Current Health & Long-Term Care

Another important consideration when planning for long-term care is your current health and the likelihood of needing long-term care in the future. Factors that can increase your risk for needing long-term care include chronic health conditions, such as diabetes or heart disease, as well as age and family history. The earlier you start planning for long-term care, the more options you will have available to you. Even if you are currently healthy, it is a good idea to start thinking about your long-term care plans now to make informed decisions.

Before you make any significant decisions, it is important that you take the time to research and investigate the different options available and which one(s) might work best for your situation. It is also a good idea to consult with your financial advisor so they can help you understand your options and guide you through the process of creating a plan that meets your needs and goals.


It's never too early or too late to start thinking about long-term care planning, and the best way to prepare for the future is to start planning today. Reach out to us today if you have any questions!