Most people know someone who has needed help with everyday activities as they’ve gotten older, things like bathing, dressing, or safely getting around the house. Long‑term care is one of the biggest unfunded risks in retirement, and ignoring it can quietly undermine even a well‑built investment or income plan.
The real risk isn’t dying too soon
When people think about insurance, they often picture life insurance that pays out when they die. Long‑term care flips that concern on its head: the real risk is living a long time but needing help along the way.
That help can take many forms: care in your own home a few days a week, adult day care so a spouse or child can keep working, assisted living when home is no longer the safest place, or full nursing home care for more complex medical needs. None of these are cheap, and several years of care can rival the cost of a house.
“My kids will help” and other myths
Many people mentally push long‑term care into a vague “family will handle it” bucket. That usually means adult children stepping in as unpaid caregivers while juggling careers and their own families, which often leads to burnout, strained relationships, and tough choices about who cuts back work to provide care.
Other common assumptions can backfire:
- “Medicare will cover it.” Medicare is designed for short‑term medical issues, not extended custodial care over months or years.
- “I have good health insurance.” Health coverage typically pays for doctors, hospitals, and procedures, not ongoing help with daily activities.
- “I’ll just use my savings.” That may work for some high‑net‑worth families, but even they often prefer to leverage their capital by transferring a portion of the risk to an insurance company, so that one long and expensive care event doesn’t undo decades of careful wealth building.
A better way to think about it: long‑term care planning is less about protecting assets for their own sake and more about protecting options, where you receive care, who provides it, and how much control you have over those decisions.
A story of two retirements
Imagine two sisters, both retired and reasonably comfortable.
Karen assumes she’ll “figure it out” if she ever needs care. At 78, she has a fall and over the next few years needs help with bathing and moving around safely. Her daughter cuts back work to provide care at home until it becomes too much. Eventually, Karen moves into a facility she and her daughter can afford, not necessarily the one they would have chosen if money were no object. Her retirement income plan, originally built for living expenses and travel, now has to be reworked to cover long‑term care bills.
Linda, her younger sister, started talking about long‑term care in her late 50s. She didn’t know which type of solution she’d end up using, but she knew she didn’t want to be a financial burden on her kids, she wanted the option to receive care at home as long as possible, and she wanted her investments focused on income and legacy, not emergency care costs.
When Linda has her own health event in her 70s, she and her husband already know what her coverage will pay for and how to access it. Her children are still involved in decisions, but they’re not forced into becoming full‑time caregivers or scrambling to figure out finances. The biggest difference between the sisters isn’t luck, it’s that one had a plan before she needed it.
Long‑term care planning has evolved
Years ago, planning was almost synonymous with traditional stand‑alone long‑term care insurance. Those policies are still important for many people, especially when they qualify for state partnership programs where available, which can help protect more assets if Medicaid is ever needed.
Over time, the landscape has broadened. Today, many families address the risk using a mix of strategies, such as:
- Traditional long‑term care coverage designed specifically for care expenses
- “Hybrid” or “linked‑benefit” life insurance that can accelerate death benefits or provide separate pools for care
- Annuity‑based solutions that can offer enhanced benefits if long‑term care is needed
Each works differently in terms of underwriting, flexibility, tax treatment, and what happens if you never need care. The point is not that one is “best” for everyone, but that there are now more ways to address the risk, including options for people who were previously declined or uncomfortable with “use it or lose it” designs.
Why it pays to start early
The best time to plan for long‑term care is usually when you’re healthy enough that you don’t feel an urgent need to do it. Starting earlier generally means more options, potentially more favorable pricing, and a better chance to integrate long‑term care into your overall retirement and estate plan.
Waiting until “after the next thing” (retirement, paying off the mortgage, getting the kids through college) often turns into never. Long‑term care is one of those risks that doesn’t get easier to solve with time.
A quiet but critical piece of your retirement plan
Long‑term care planning isn’t about fear or dwelling on worst‑case scenarios. It’s about designing a retirement that remains dignified and flexible, even if your health doesn’t follow the script. It’s about giving your future self and your family clarity around three questions: who will provide care if you need it, where you would prefer to receive it, and how it will be paid for without derailing everything else you’ve built.
Those questions don’t have to be answered perfectly on day one, but they deserve more than a shrug and a hope that “it will work out.” If you haven’t addressed long‑term care in your own planning yet, consider this your invitation to start the conversation with a professional who can review your age, health, assets, and goals, walk you through the types of solutions available today, and help you decide whether now is the right time to put a strategy in place.
You may never need extended care. But if you do, having a thoughtful plan could be the difference between scrambling under stress and simply activating a strategy you set up years before, so you and your family can focus on care and comfort, not just costs.
About Genesis Wealth Advisor Group, LLC: Genesis Wealth Advisor Group is an independent fiduciary financial planning firm headquartered in Marlton, New Jersey, serving clients in multiple states with retirement income planning, employer plan guidance, and holistic wealth management services.
Disclosure: Securities and investment advisory services offered through Osaic Wealth, Inc. member FINRA/SIPC. Osaic Wealth is separately owned and other entities and/or marketing names, products or services referenced are independent of Osaic Wealth.
