Reverse Mortgage Long Term Care

Many seniors are now using a reverse mortgage to generate the funds need for long term care. Here are some questions you should consider before purchasing a long term care.

Should I buy long-term care insurance?

A long stay in a nursing home is many retirees' worst nightmare. The expense can ruin nearly anyone's finances.

Your odds of winding up a long-term resident in a nursing home are long, probably longer than you think, says Joseph Matthews, a San Francisco lawyer and editor of Long-Term Care: How to Plan and Pay for It, published by the Nolo Press. The key word is "long-term," more than six months. Many people will have short-term stays in nursing homes after major surgery, for example. Long-term care insurance typically doesn't cover that.

If you choose to get long-term care insurance as a safety net, your premiums will depend mainly on these factors:

— The waiting period before it starts to pay. A long waiting period — say, six months — will get you a lower premium than a policy with a three-month waiting period. But you'll have to be able to afford the six months you wait.

— How much it pays.

— How old you are. The older, the more expensive the policy.

If you're shopping for long-term care insurance, be sure to get a rider that increases your payments with inflation. "If you get a policy that pays $100 a day, that won't buy a candy bar in 30 years," Matthews says. And make sure the policy covers assisted living or home health care, or you might be forced to go to a nursing home.

Your insurance shouldn't cost more than 5 percent of your income. That's your retirement income, not your income now.

Although most people won't need long-term care insurance, it does provide peace of mind. "I just bought a policy not too long ago, and I feel good about it," says Vern Hayden, a 67-year-old financial planner in Westport, Conn. "It's enough to get into a good home if I need it."

RTG Consultants, can support your reverse mortgage and long term care needs and qeustions, pleaes email us or call us toll free at 1-888-973-8377