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Carla Fried: Will you need long-term care? And what'll it cost?

Carla Fried, Rate.com on

Published in Home and Consumer News

Chances are you’ve come across a headline or two pointing out that retirement healthcare costs will likely run well into the six figures. What often gets lost in translation is that those scary estimated costs are spread out over a retirement that is expected to last 20 or more years.

As an analysis by T. Rowe Price calmly pointed out, when you break down the big scary number into a monthly or annualized basis throughout retirement, it becomes a much more manageable sum that can often be paid for out of regular retirement income, or by dipping into savings from time to time.

That’s the good news.

Now some not-so-good news: Those estimates don’t factor in the cost of needing long-term care.

It’s vitally important to understand that long-term care is not solely about nursing homes.

Long-term care is a catch-all phrase for all sorts of help the elderly may need in their homes. That can include so-called activities of daily living such as help with bathing, dressing and eating. Help with household chores and errands is another common need for the elderly.

 

The odds you might need long-term care help

HealthView Services is a data company that provides retirement healthcare estimates for financial advisers and consumers, drawing from government data, medical claims and actuarial data on life expectancy. It recently published a report on both the potential for needing long-term care help later in life, and the potential cost of that care.

A healthy 65-year-old male has a 44% probability of needing some level of long-term care during his expected life span. For a woman, the odds are 56%. If those 65-year-olds are married there’s a 75% chance that at least one spouse will need long-term care assistance.

If a 65-year-old has heart disease the odds of eventually needing long-term care rise to 61% for women and 45% for men.

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