30 Day Financial Transition Challenge Day 21: Long Term Care

Welcome to Day Twenty-One of the “30 Day Financial Transition Challenge.”  Today’s article focuses on long term care.

Bottom Line Up Front (BLUF)

Most servicemembers probably do not need to worry about long term care when they exit the military.  However, long term care does have an impact on many families.  Today, we’re going to take a look at whether this applies to your family, and make sure you incorporate this into your plan, if necessary.

Why? 

According to the CDC, 25% of U.S. households are impacted by caregiving responsibilities.  Assuming that holds true for military personnel, that means 1 in 5 people reading this article could be dealing with long term care issues as they’re transitioning.  Whether long term care for a loved one is something you’re currently dealing with, or something you might have to evaluate in the future, it’s important to take some time to think about it.

Long term care is expensive, in terms of money, time, and personal stamina.  It takes a lot of time, effort, and expertise to care for people who can no longer care for themselves.  If you’re in a position where you might one day be in charge of someone’s long term care, you owe it to yourself to prepare for that day.

Related Links

The following video is a PBS News Hour segment about the challenges and tolls of long term care, particularly for baby boomers with Alzheimer’s or dementia.

Goal

If this topic doesn’t apply to you, today is a great opportunity to go over and refine your to-do list.  If it does, you should finish today with:

  • A clearer understanding of long term care decisions that might be coming down the line
  • Plans to have conversations with people involved in those long term care decisions
  • Starting point for further discussion & research

What you need 

Nothing

How-to

Below are some questions that might help you capture the important aspects of long-term care.

  1. Do you think you need a long term care insurance policy?  
  • If you’re under 50, probably not right now
  • If you’re over 50, or have a family history of debilitating illness, you might want to look into it.
  • What major changes have occurred since the last time you looked at long term care? (marriage, divorce, children, etc.)
  1. Do you have parents or other relatives with long term planning needs?      
  • What conversations have you had about this, specifically about their intentions?
    • Estate planning
    • Medical directives
    • Roles & responsibilities
  • Will you need to make career changes to accommodate them?
  • What long term care insurance do they have?
  • Do you have other assistance (i.e. siblings, other relatives)?
  • If there are out of pocket costs, are they affordable?
    • Who will pay them?
  1. If you have long-term care concerns, but don’t know how to address them, do you know who to turn to?
  • Do you live in a state with partnership options?
    • Look here to see if your state has a partnership program
    • If so, talk to your state’s long term care partnership program ombudsman for more details
  • Have you talked to a fee-only financial planner? A financial planner might be able to help you navigate some of the more difficult questions, such as:
    • Is long-term care insurance worth the cost?
    • Do I need to completely deplete our assets (or my parents’ assets) to qualify for state aid?
    • What can I afford?

4.  If you plan to self-insure, is this something that you’ve budgeted for, in terms of time AND money?

5.  If you’re planning to care for a loved one, is this in their estate planning documents?

Conclusion

Long term care planning is something that no one wants to do.  However, being prepared could mean the difference between having the ability to properly care for a loved one and having to defer or delay your own retirement.

Tomorrow, we’ll discuss disability insurance.  It’s important to protect your income against disability, in the event you’re not able to work.  However, it’s vitally important to understand what is available, what insurable needs you need to cover, and what you should budget for.

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About Forrest Baumhover

Forrest Baumhover is a Certified Financial Planner™ and tax professional. His firm, Westchase Financial Planning, focuses on the unique financial planning needs of servicemembers and families looking to separate or retire from active duty.If you’d like to learn more about Forrest or his services, please check out the About Forrest page at the top of this article.
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2 Responses to 30 Day Financial Transition Challenge Day 21: Long Term Care

  1. Pingback: 30 Day Financial Transition Challenge Day 20: Estate Planning

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