FINANCIAL Long-Term Care — A Reality Check If you were creating a list of subjects few people want to discuss, it is likely that the pros and cons of having long-term care insurance would occupy a prime position. It’s not hard to see why. Who among us wants to confront the notion that one day we may not be able to look after ourselves as we always have? Who easily entertains the idea that long-term care needs may lie ahead? Yet, the reality is that nearly two-thirds of Americans over age 65 ultimately will need long-term care services of one kind or another, says the U.S. Department of Health and Human Services. That means the majority of us at some point will need home care, adult daycare, assisted-living services, visiting nurses or nursinghome care. In itself, the idea is difficult enough to grasp – but there is another important question: Who is going to pay for this care? No type of personal care is inexpensive, and costs rise the more intensive services become. For example, the median annual cost of care in a private room in a nursing home stands at $75,190, according to the 2010 Genworth Cost of Care survey published in April 2010. WEIGH THE POSSIBILITIES Long-term care insurance may not be necessary for everyone – there’s a school of thought that suggests that if your portfolio is ample enough, it might easily absorb any future long-term-care costs without significant damage. Nevertheless, such insurance is clearly the answer for many people, and the younger you are when you sign up, the lower the monthly premiums will be. In 2007, the average cost was $2,207, but premiums ranged from $881 annually for someone under 40 to $3,026 annually for someone 70 or older. When considering whether you should investigate the idea of carrying long-term care insurance, keep in mind that quality care may be only part of the overall consideration. Such a policy can also help to create a kind of safety net that shields family members from having to bear unexpected financial burdens. Long-term care policies can be complex instruments. If you’d like to discuss whether such a policy should come from part of your financial plan, I’d be happy to do so. Just give me a call. ■ by Kathy Greeneway HUMAN OPTIMISM AT WORK Erroneous beliefs predominate when it comes to long-term care. AARP found in a 2006 survey that most Americans over 45 know very little about the subject. Many believe public programs will cover it, but that isn't so (Medicare doesn't pay for extended nursing home care; nor does Medigap/Medicare Supplemental Insurance). Most also underestimate the costs, and many believe they have long-term care insurance, when, in reality, they do not. Studies indicate few Americans place long-term care needs high on a list of concerns. We want to live in our own homes without interference from anyone else. We hope for good health. We believe life insurance is needed for our family's security; we want home insurance, though we’d rather not have a fire. But we don't expect to ever actually need long-term care insurance. WHEN LONG-TERM CARE APPLIES Most long-term care policies don’t apply until you cannot perform at least two of the “activities of daily living” and a medical professional agrees the condition will last 90 days or more. Policies will also usually begin paying if the insured develops a degenerative condition, such as Parkinson's disease, or a cognitive impairment due to Alzheimer's or severe dementia. Activities of daily living include: • Bathing • Dressing • Eating • Using the toilet • Moving back and forth between a bed and a chair 10 ■ HERVOICE MARCH/APRIL 2011 Kathy Greeneway is a Certified Financial Planner® with Raymond James Financial Services, Inc. located at First Dakota National Bank, 225 Cedar St., Yankton, SD. Securities offered through Raymond James Financial Services, Inc., Member FINRA/SIPC, and are not insured by FDIC, NCUA or any other government agency; are not deposits or obligations of First Dakota National Bank; are not guaranteed by First Dakota National Bank; and are subject to risks, including the possible loss of principal. First Dakota National Bank and First Dakota Brokerage Services are independent of Raymond James Financial Services. Quality Dental Care for Kids The American Academy of Pediatric Dentistry recommends your child visit a dentist when the first tooth comes in, usually between 6 and 12 months of age. Early examination and preventive care will protect your child’s smile now and in the future. Children with healthy teeth chew food easily and smile with confidence. Start your child now on a lifetime of good dental habits. Call to set up your appointment today! 665-2448 For more information stop by our clinic at 1101 Broadway Suite 105 in the Morgen Square Plaza or visit our website at www.scott-family-dentistry.com