Let’s cut through the fluff.

You’ve probably heard that everyone over 50 needs long-term care insurance or they’ll end up draining their life savings in a nursing home. But is that actually true anymore?

The long-term care (LTC) insurance landscape has shifted dramatically over the last decade. Premiums have skyrocketed, benefits are more limited, and many companies have exited the market altogether. So naturally, the big question is: Is it still worth it?

What Is Long-Term Care Insurance?

Long-term care insurance helps cover services that aren’t typically paid for by health insurance, Medicare, or supplemental plans. This includes help with basic activities like bathing, dressing, or eating, either at home, in assisted living, or a nursing facility. 

If You’re a Middle-Income Earner, Listen Up, Long-Term Care Could Drain Your Savings…

Here’s the deal: if you’re earning a steady, middle-class income, long-term care (LTC) might be one of the biggest financial threats you haven’t planned for. The costs of in-home care, assisted living, or nursing facilities can run into the tens, or even hundreds of thousands of dollars a year. And no, regular health insurance and Medicare typically don’t cover it. That means those bills are coming out of your pocket.

Without LTC coverage, many middle-income individuals end up “spending down” their assets, burning through retirement savings, selling off investments, and even dipping into home equity, just to qualify for government assistance through Medicaid. But here’s the catch: Medicaid only kicks in after you’ve significantly reduced your assets, often leaving little behind for your spouse, family, or future needs. Planning ahead with LTC coverage can help you protect what you’ve worked hard to build and avoid tough financial trade-offs later on.

According to recent data, about 70% of adults over age 65 will need some form of long-term care, with women averaging 3.7 years of care and men 2.2 years, yet one in five will need support for more than five years, making early planning not just smart, but essential.

What’s the Problem?

In short: rising costs and shrinking benefits.

• • Premiums can be unpredictable
    Many policyholders have seen their rates double or triple over time. Unlike life insurance, LTC policies can increase premiums after purchase, with state approval.
  • Fewer companies in the market
    A wave of insurers underestimated claim costs and bailed, reducing competition and flexibility.

• Strict underwriting
  If your health isn’t spotless, you might be declined or forced to pay more for less.

But Here’s the Twist…

Not all LTC planning requires a traditional LTC policy. Today, there are creative ways to prepare without locking into a plan that might become a money pit.

• Hybrid policies
  These combine life insurance with LTC benefits. If you don’t need care, your heirs still get a death benefit. No “use it or lose it.”

• Annuities with LTC riders
  Some annuities offer built-in LTC benefits that activate if you need care. It’s like a financial multi-tool.
• Health Savings Accounts (HSAs)
  If you’re still working and have a high-deductible health plan, you can save pre-tax dollars to pay for LTC premiums later.