by Deneen Cunningham, McVagh Cunningham –
It’s a beautiful Sunday morning: you’re enjoying a coffee, reviewing the retirement income report from your financial advisor. You smile, thinking retirement looks comfortable.
Then you receive a phone call from your dad, who shares the news that your mom has fallen again. He doesn’t think he can look after her anymore, but doesn’t know how he will afford care for her.
You realize you haven’t factored this cost into your own retirement plan, and your smile disappears.
Statistics tell us improved health care is allowing Canadians to live longer. This is great, but there may be significant costs to consider as you age. If you require in-home care, or need to move to a facility, have you planned for these costs?
One solution is Long-Term Care Insurance, a product designed to help ease the financial burden.
Many experts say the ideal time to purchase this coverage is in your 50s. The monthly cost usually begins at roughly $200, depending on the amount you purchase. Now, how much will you need?
Home care services provided by the government vary, depending on the resources available in your community. The Government of B.C. website is a good resource for the available services.
It’s important to look at what is available after you have exhausted government-provided resources: does one of your children have a basement suite? Can they help you with your daily needs? You may not want to be a burden to your children, or rely on them to have the time and resources to look after you, so now you need to look at additional options.
The costs for a care facility vary greatly. Your out-of-pocket monthly expenses can range from $1,000 for ward-level accommodation in a government-subsidized facility, to over $5,000 for a private room in a non-subsidized facility.
If those numbers are not factored into your retirement income plan, Long-Term Care insurance is something to consider. These plans are designed to bridge the gap between government benefits and the additional care or services you might want to access.
Long-Term Care insurance can be an important component of your retirement plan. The application process will likely include answering some medical questions, and additional information may be requested from your doctor before a decision is reached by the insurance company. The best way to determine if Long-Term Care insurance is right for you is to discuss your needs with a Financial Advisor who is qualified to help you buy insurance products.