Tuesday, November 24, 2015

How to pay for rising LTC premiums


Are you considering buying a long-term care insurance policy? Hopefully you’ve done your homework to make sure such a plan is right for you. And don’t forget … premiums are sure to rise … simply because long-term costs continue to rise.

According to the insurance giant Genworth, the average annual cost of a semi-private room in the U.S. $80,300; and a private room will run you $91,250. The 5-year annual growth for both is 4 percent.

One idea is to set aside money in an account that includes quality dividend-paying stocks or mutual funds to help pay for any premium hikes. The average dividend yield for the S&P 500 is approximately 2 percent. Bonds, bond mutual funds, or real estate investment trusts (REITs) could boost that yield even more. Contact your financial advisor on the best way to structure this account. 

Would you like other funding ideas for your long-term care needs? Then click here to get a copy of A Boomer’s Guide to Long-term Care. It’s available for immediate download to your Kindle or in a paperback version. 

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