Long Term Care Planning for Boomers and Millennials

Today, yesterday’s baby boomers often need managed health care over an extended period, which can mean heavy medical bills, compensation for caregivers and other associated costs. For most, this means staying in a nursing home or care facility, just to avoid depleting savings and retirement income completely or being a financial burden on their loved ones.

Today’s generation, the millennials, believe that baby boomers failed to save enough for their future, and choose not to repeat those mistakes. They better understand the need to invest in long-term care for their future financial security and underlying peace of mind.

Here are some of the challenges that both millennials and baby boomers face in planning for long-term care (LTC) needs:

• Underestimating LTC Costs
  

  Often, individuals who try to save enough for retirement underestimate exactly how much they will need. This is typically because they underestimate the costs of healthcare in nursing homes, assisted living facilities or home care, and other lifestyle expenses in the future. It is these individuals who end up saving but falling short when the time comes.

  That is the main reason why millennials believe boomers have not saved enough, for their examples reveal the lack of future financial security, especially in an economy with skyrocketing long-term care costs. Millennials who understand this dilemma tend to make better decisions regarding their savings and investments for the future.

• Soaring Costs of LTC Insurance
  

  Investing in insurance is also extremely heavy on the pockets considering the high premium costs that come with owning an insurance policy for future financial security. These costs only seem to be getting worse due to inflationary pressures, which play a massive role in the soaring rates for long-term care insurance.

  Of course the price of a chosen policy varies drastically, depending on the chosen type of insurance and other factors like age and choice of coverage. It’s essential to opt for the right kind of coverage, since applying for less or more than necessary has its own set of drawbacks.

• The Burden on Millennials
  

  Baby boomers did not feel the same burden that millennials feel in regards with providing long-term care for their parents and grandparents, due to far lower costs that prevailed in their time. However, they need potential long-term benefits for health care far more than millennials and must take serious decisions to overcome their shortfalls.

  On the other hand, most millennials already have significant burdens on their shoulders. They need to not only provision for the care of their parents and grandparents, but also their own healthcare, asset protection and other lifestyle expenses, to avoid being a burden on their children in the days to come.

Advisor’s Tip for Millennials and Boomers

With every passing generation, the one thing that stays constant is change in the way things are done, and the varied results that manifest as repercussions to those changes. How boomers and millennials save has also changed over the years, and too often, they disagree with their planning needs and execution.

Both boomers and millennials need to understand that savings are imperative in order to have a financially secure future, as well as avoid further increase in the financial burden they bear for their future.

Hence, they need to evaluate their current financial situation to get a better understanding of how much they’ll need to save and find the necessary means to help bridge the financial gaps. Opting for long term care insurance is a great way to start saving for future costs, and the sooner the better!