Strategies to Help Pay for Long Term Care
Implementing strategies to help pay for long term care can help you to prevent a lot of stress and trouble. It also can help to preserve funds for the benefit of your spouse or other loved ones. In this article, we will review 4 strategies to help pay for long term care.
1. Long Term Care Insurance
Long term care insurance is a special type of private insurance. It helps provide coverage for nursing home care, home health care, personal care, or adult daycare. These policies help to provide quality care at guaranteed rates. However, these policies are expensive and usually only cost-effective if you make the purchase before you reach age 60.
Medicaid is a government-run program that provides low-income individuals with healthcare, including long term care services. These programs are run at a state level. If your income and assets meet the requirements each state sets, Medicaid will provide you with coverage for nursing home care. However, home health services are generally not covered by Medicaid.
3. Asset Protection Trust
If done properly, you can use an irrevocable trust to help qualify for Medicaid. By placing assets in the trust, you give up control of them. By doing this, you can keep those assets from being counted towards your asset values for Medicaid purposes. It is important to note that there is a 5-year look-back period that applies. This means that Medicaid will look at 5 years’ worth of your finances and your income/assets must be at qualifying levels for all 5 years. This prevents people from last-minute planning as soon as they find out they need coverage from Medicaid.
4. Fund an Annuity
If long term care insurance does not fit into your budget, finding the right type of annuity can help you to fill in the gap. Many annuities offer long term care riders. These riders will allow you to increase the income you receive from your annuity to help you cover the additional costs of long term care services.
Maximizing on Strategies to Help Pay for Long Term Care
Maximizing on strategies to help pay for long term care can help you preserve your wealth for your family and guarantee you will receive quality care. A Certified Financial Planner ® can analyze your current financial situation and advice you on what the best strategy is for your situation.
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