When you envision your retirement, you may not stop to think, "What if I’m unable to do the things that I can do today?" However, someone turning age 65 today has almost a 70% chance of needing some type of long-term care services and supports in their remaining years. Long-term care is all about having help to do basic things. Use this information to better understand the pros and cons of long-term care insurance.

What is long-term care insurance?

Long-term care insurance provides coverage for the costs of long-term care associated with the activities of daily living, such as eating, bathing, dressing, and other needs. The need for long-term care may be due to a chronic illness or injuries that require extended rehabilitation and care.

The younger you are when you purchase long-term care insurance, the lower your premiums will be (though you will pay them for longer). If you wait to buy long-term care insurance until you are experiencing health problems, you may find you aren’t eligible for coverage.

Know the benefits and costs

Long-term care policies vary significantly in their benefits. Some cover in-home care, such as housekeeping, maintenance, and transportation assistance. Others provide full-fledged nursing home care. The costs of the policies reflect those benefits, but your present health and your family’s medical history can also affect what you pay.

Benefits are usually paid in the form of a daily or monthly allowance. To ensure your policy’s benefits keep up with rising costs, you can opt for an inflation rider. An insurance professional or Financial Advisor can help you compare policies.

Balance needs and costs

Most long-term care insurance policies cap their benefits at a certain dollar amount. Those that offer lifetime benefits may charge higher premiums. Long-term care policies might offer different coverage depending on where the person is being treated.

That said, choosing a policy is all about balancing those costs and needs. Think about what is going to be sufficient coverage for you, that would help protect you to the extent possible within the boundaries of what’s affordable. Consider consulting with a financial professional to help determine if long-term care insurance would be appropriate for your needs.