The cost of expert medical care in America continues to soar. According to the Genworth cost of care overview, the cost of a year of nursing home care in the U.S. averaged $80,300, with a projected 5-yr annual growth of 4%, which would be roughly $97,697 after the fifth year if growth remains consistent. However, in some states such as Alaska, the yearly cost of this care can spike as high as $281,415!
These enormous costs make this kind of long-term care a huge financial burden for almost any retiree. What many retirees might not realize is that there’s a 70% chance that any American at or over the age of 65 will need some form of long-term care during their lives, according to longtermcare.gov.
How do you plan to cover the cost of long-term care such as nursing home care or extended hospital stays?
Three Ways to Fund LTC
There are several ways to fund long-term care, three of which are:
As a last line of defense, Medicaid may pay for nursing home care if you meet certain criteria, such as having an income within a certain percentage of the federal poverty level and having spent most of your assets. Unfortunately, if you qualify for Medicaid, it probably means you are now low-income and have few assets remaining.
Paying for long-term care can be a financial disaster waiting to happen, so take steps to protect yourself as soon as possible against this all-too-common retirement risk.
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