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Kiplinger: What Retirees Need to Know About 3 High-Cost Financial Products

Long-Term-Care Insurance

You may not need long-term care. You're less likely to end up in a nursing home if you're married. Even if you do need long-term care, the cost is likely to be contained: The median stay in a long-term-care facility is 463 days, according to the Centers for Disease Control and Prevention.

If you invested the annual premium for a 60-year-old couple of $3,335 for 25 years and earned a 4% annual rate of return, you'd have about $153,000. If you don't need long-term care, the money can be used for other purposes.

The drawback to self-insurance is that your savings may not be sufficient to cover the cost of a chronic illness. In 2011, 10% of long-term-care insurance claims were for individuals under age 70, according to the AALTCI. Some of those individuals will require nursing-home care for a decade or more.


More From Kiplinger:
QUIZ: Are Annuities Right for You?
10 Least Tax-Friendly States for Retirees
10 Things You Must Know About Social Security

The opinions expressed are solely those of the author and do not necessarily reflect the views of Comcast.

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