Everything You Need to Know About Long-Term Care

By Shawn Britt

For many families, the job of taking care of mom and dad in their golden years naturally goes to the daughter. It’s the way society has worked since the beginning of time. Besides, being a nurturer is in our DNA. But not much thought goes into how much that role costs women when it comes our time to retire.

It is estimated that 75 percent of unpaid caregivers in the U.S. are women. Being a caregiver takes a physical and mental toll and also can have a catastrophic financial impact. Women typically work 12 years less than men over their lifetime to care for children and other family members. That’s an average of $565,000 in lost earnings – plus lost pension and social security.

Because women live longer than men, they spend more time in retirement and face a greater risk of outliving their retirement assets. Longevity also increases their chances of needed long-term care costs during their golden years. That’s why it’s especially important for women to plan for health care costs in retirement.

Make a plan

However, few women are making those plans. A recent survey by Nationwide Financial found nearly half of both women and men say they are “terrified” of what health care costs may do to their retirement plans. Yet, women are much more likely than men to say they have not estimated:

• How much they will spend each year in retirement on things like premiums, copayments and deductibles (41 percent vs. 27 percent men)
• How much income in retirement they will have from things like social security, retirement accounts or pensions (21 percent vs. 12 percent men)

While 65 percent of women have discussed their retirement with a financial advisor, of those who have, only one in 10 talked about how much they should expect to pay in health care costs apart from Medicare (compared to one in four men).

Peggy Andrew Bellows, a financial advisor with Morgan Stanley Smith Barney, feels she is not doing her job if she doesn’t discuss health care costs – including LTC expenses – with her female clients.

Bellows points out that LTC is even more of a problem today because many families have kids living all over the country and not available to take care of their parents. She says while it’s a challenge just getting people to save enough for their retirement, they still need to recognize the risk of LTC expenses and hopefully insure against it.

Bellows says while traditional a LTC policy has lost its appeal, many women are interested in a LTC rider on a life insurance policy – where if it is not used their children get the money.

Bellows says 99 percent of her job as a financial advisor is educating her clients. They are a lot more comfortable insuring long term care when they understand the details of the contract. She says women are receptive to these conversations because just about every woman has a friend who is taking care of a parent and knows exactly what that entails.

The good news is women want to have these discussions. The Nationwide Financial survey found more than 43 percent of women say they plan to meet with a financial advisor to discuss health care costs. Financial advisors can play a major role in helping women plan for and live in retirement by discussing the role Medicare will play in their retirement and helping them estimate future health care costs.

Stop the cycle

It started out with us helping our mom care for grandma. Then we care for our parents. Then our husbands. Then our daughters and granddaughters care for us. Our parents never meant for us to make significant sacrifices for them and we don’t want to make our children do the same, but the world has changed.

Women and their families need to be aware of what they will face if they do not plan ahead for this risk both emotionally and financially. That means having a candid conversation with family members and a financial advisor. Planning now gives you choices later – including ways to stay in your home longer. You don’t want to make a last-minute emergency decision that could impact your loved ones.

Shawn Britt has been engaged in the life insurance industry for over 17 years. She joined Nationwide in 2000 and has been a member of Nationwide’s Advanced Sales Team since 2005.

Shawn is most known at Nationwide for her extensive work and expertise with the Long- term Care Rider and has been has been a major influence in promoting this rider and educating the field in the many uses the LTC rider affords. She has authored marketing pieces and published numerous articles on life insurance concepts, the LTC rider and the subject of long-term care in publications such as The National Underwriter, Advisor Today, Life Insurance Selling, Agent’s Journal and California Broker.

**The views and opinions expressed here are those of the writer and do not necessarily represent the opinions of Nationwide.