Elder Law: How to Keep Long-Term Care Costs From Draining Your Finances

When retirement comes, you want to enjoy every moment of your golden years. You have probably thought about these years throughout your life: the endless vacations, the freedom from working, the time to finally work on your book, go golfing, and more. This is all possible IF you do not end up requiring long-term care, which can significantly drain your finances and ultimately ruin your retirement goals. Here is how you can keep long-term care costs from draining your finances.

Step 1: Assessing Your Individual Long-term Care Costs

When it comes to long-term care, it is imperative to consider how your place of residence will adequately support your needs as you age, especially when you can no longer take care of yourself. Ultimately, the idea is to start planning early. How early? Well, studies have shown that up to 50% of people who reach 65 years will require long-term care in the long run. In America, long-term care costs can reach a staggering $100,000 a year with a private room. When you account for inflation, and depending on your age at the moment, this figure can rise dramatically by the time you are put under long-term care. A general rule of thumb is to start planning now, if you haven’t already.

Step 2: Understanding the Long-term Care Settings

There are three main settings for long term care, depending on the amount of help required: your home, a community housing arrangement, and a nursing home. Those who can afford the cost of bringing specialists into their home do not require any other care setting. They can enjoy the serenity of dying peacefully at home, with their loved ones close by. The worst thing that can happen, if you are not fortunate enough, is having to rely on your family for long-term care with little to no prior warning. To add salt to injury, most government programs such as Medicare are severely handicapped, which is why it is important to invest in a long-term care insurance plan early on.

Step 3: Investing in Long-term Care Insurance

If you are a low-income earner, you may qualify for Medicaid, a government program that caters for long-term care expenses of poor people. Alternatively, investing in a long-term care insurance plan can be a great way to preserve your assets in the future in the event of costly medical care needs. You also don’t need to buy long-term care insurance if you expect to have a substantial amount of money after retirement, as you can easily treat those expenses like your other bills. Long-term care insurance is much more suitable for those who fall in between these two groups (i.e those who do not have enough money to meet their long-term care expenses out of their pockets, and those who earn just above the minimum requirement to qualify for Medicaid).

Step 4: Planning Documents and Instructions

When all is said and done, you need to present your long-term care documents to your family or trusted advisers. These instructions can include wishes regarding care preferences, preferred medical treatments, end-of-life, and disposition of property to the Personal Care Representative or Care Advocate. While these instructions do not stand for formal legal documents prepared for the same purpose, they can be used to highlight established preferences.

These are some of the steps you can take to proactively minimize long-term care costs and preserve your assets for other purposes. If you need any further advice on this and other important legal concerns in Texas, Amsberry Law Firm is here for you. Feel free to contact us anytime at (210) 354-2244.

Written by Amsberry Law Firm

Amsberry Law Firm

Mr. Amsberry is board-certified in family and labor and employment law by the Texas Board of Legal Specialization. He is also active in family law, estate and elder law, and business law. He is a proven litigator who has argued before the United States 5th Circuit Court of Appeals and earned favorable outcomes in complex, precedent-setting employment and civil rights cases. He served as a reservist assistant judge advocate general in the U.S. Army and is a sought-after lecturer and speaker on a range of legal issues.