The purchase of Long Term Care insurance shields families from potential regret caused by the financial and time-intensive burden of having to care for elderly loved ones. As stated in an article released by Genworth, the absence of Long Term Care appropriations is responsible for serious monetary strife, tension and anxiety amongst family members. Without Long Term Care coverage, the responsibility of primary care-giving falls solely to the family members of aging relatives.
Planning is key. According to Genworth, studies found that planning for Long Term Care is most common amongst individuals who have received, or are receiving professional day care and much less common amongst individuals who are used to depending on their families’ for care. Many individuals do not plan for their future care because of the emotional pain involved. According to Genworth, most individuals recognize the mistake they’ve made in not planning but more significantly, nearly 51% of individuals without Long Term Care coverage admit that plans should have been made sooner.
Although the emotional tolls of failing to plan for Long Term Care are real and painful, the financial costs are devastating. Genworth notes, had Long Term Care insurance been purchased prior to the care-requiring event, families could have saved nearly $11,000 per year in out of pocket expenses.
Planning Can Reduce Stress Faced by Caregivers, Finds New Genworth Study
Families could save nearly $11,000 annually if long term care plans were made earlier
Richmond, VA (October 21, 2013) / PRNewswire / — More than half (53 percent) of family members serving as primary caregivers for loved ones have lost income due to the demands of providing care. The study, Beyond Dollars: A Way Forward, also found that caregivers whose loved ones did not have long term care insurance face additional stresses including covering the cost of daily living, medical and other support-type needs.
“Most families believe they can solve a long term care crisis themselves or that a family member will bear the load of caring for an aging relative,” said Bob Bua, President of CareScout, a Genworth company. “This thinking may work for the short term, but over a longer period of time, families will start to feel the burden of stress and guilt affecting the care receiver, caretaker and the entire family.”
In light of November’s Long Term Awareness Month, Genworth encourages consumers to educate themselves on their long term care options to overcome the personal and psychological pitfalls that arise around money and financial planning.
Regrets and the Cost of not Planning
“People tend to wait for a crisis to hit before recognizing the importance of having a plan in place,” said Roger Baumgart, CEO of Home Instead Senior Care. “We plan for marriage, home ownership and other life changing events; families need to plan ahead for what we know to be a very expensive burden in retirement and that’s the cost of long term care.”
Planning ahead is most common among care receivers who enlisted professional care and is less common among recipients relying on a family caregiver. In fact, the study found that forty percent of those who received care at a day care facility made plans to cover a long term care situation while only 23 percent of those who moved into a family member’s home did the same.
The Beyond Dollars study not only demonstrates the impact a long term care event can have on family members, relationships and savings, it also reveals that the cost of waiting is high. The study finds that on average, families could save nearly $11,000 annually in out of pocket expenses if long term care arrangements were made before an actual long term care event occurred. Those that did not make plans for their long term healthcare needs recognize their mistake as more than half (51 percent) say that steps should have been taken sooner to prepare.
Among the many reasons for not taking steps to plan sooner, 38 percent of care receivers did not want to admit care was needed, 28 percent did not want to talk about it and 23 percent did not know where to start.
Financial and Emotional Toll
By taking on the responsibility of caring for a loved one, caregivers may feel increased stress and health issues that go far beyond the financial toll. The study found that 38 percent of caregivers and 35 percent of care recipients believe stress could have been avoided if care had been received sooner.
Looking at the relationship between those who had purchased a long term care insurance policy versus those who did not,Beyond Dollars found that more than half (58 percent) of those without long term care insurance see the benefit in owning a policy and regret not having one. The majority believe long term care insurance would have resulted in relief from the financial burden associated with long term care (59 percent); less strain on family situations (59 percent); and relief from stress on the family (51 percent).
“My family faced a long term care crisis when my father became ill and needed nursing home care,” said Olympic Gold Medalist Wendy Boglioli, National Spokesperson for Genworth. “This first-hand experience prompted my husband and me to plan well in advance so our children would not have to worry. The consequences of not having a plan are life-changing and the most important first step is having the conversation.”
Working beyond the psychological and financial barriers many people face in starting to plan, Wendy suggests initiating the conversation by:
- Think past the present: Create long-term goals to cultivate an interest in your family’s financial future
- Enlist an expert: Develop a team that includes an Elder Care Attorney, Financial Professional and Tax Accountant to help your family understand the ins-and-outs of planning for long term care; don’t try to do it alone
- Consider the realities: Don’t assume what would work today will also work in 10 or 20 years from now, take into affect your family’s availability and their impact
- Put a plan in writing: Having a written plan allows you to monitor goals and adjust your plan to help stay on track
- Tell your family: Have an open dialogue with your family on your needs and goals for long term care in order to have a team by your side that understands your plan