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There are many benefits to having long-term care insurance. However, there can also be some hidden challenges. Depending on the insurance policy, there may be some aspects of long-term care that isn’t covered. For example, some policies will not cover expenses until 90 days after moving into a long-term care facility. Some policies also only cover expenses for a specific term, such as two years of facility care. This can be a challenge that many caregivers and family are unprepared for. Ensure you are planning carefully for potential long-term care costs without a long-term care policy.

Research All Long-Term Care Options

Having a full understanding of all the long-term care options available for your loved ones is crucial. Aside from nursing homes, options include hiring a home health agency, day services for adults, and moving to an assisted living facility or residential group home. If your loved one does not have medical needs, assisted living programs may be more cost-efficient. Ensure that you explore every option available to help save money in the long run.

Utilize Social Security, Pensions, and IRA

Social Security and pensions are typically guaranteed incomes. By combining these with other potential monthly incomes, it can help reduce the long-term care bill. Withdrawing money from an IRA account may qualify for a deduction of medical expenses. While pulling money from an IRA raises an individual’s taxable income, utilizing it only for long-term care costs provides a tax deduction that essentially turns the IRA into a health savings account that is tax-free.

Cash In Whole Life Insurance Policies and Savings Bonds

All of those savings bonds that have been sitting around for year will now come in handy. Cashing them in will assist in covering long-term care expenses. The same goes for whole life insurance policies. The policy has the opportunity to be sold for 50 to 75 percent of the death benefit if it has a cash value that won’t be used.

Look Closer to Home

To help pay for long-term care, selling your loved one’s house might be an option. If a spouse is still living at home, however, researching a reverse mortgage is an additional option that may assist in paying long-term care expenses.

Apply for Medicaid

This option may not be available to every applicant, as the rules vary by state. Check with your financial advisor to see if you qualify.