Oct 21, 2023, 2:00 am EDT
Imagine you knew that 80% of the homes in your neighborhood would eventually suffer damage in a storm—but less than 4% of them had insurance that would protect them against a potentially catastrophic expense.
This lopsided risk scenario is similar to how unprepared Americans are when it comes to long-term care. A 2021 report by the Center for Retirement Research at Boston College found that around 80% of 65-year-olds will need some measure of long-term care and support services in their later years.
Yet only 3.1% of Americans have a long-term care insurance policy, according to LIMRA, a trade group. The policies are expensive, and seniors are unsure if they will need it. “It’s a little bit amorphous—it’s not a sure thing,” says Dana Levit, a certified financial planner with Paragon Financial Advisors in Newton, Mass. “It’s hard to convince people now to save for this huge expense. They’ll push that one down the road.”
Levit says some of her clients have had a parent or friend experience a long-term-care need and are concerned they’ll go through the same thing. “They want to be prepared financially,” she says, but it “translates into anxiety, not necessarily into action.”
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