Message Font: Serif | Sans-Serif
No. of Recommendations: 0
Corimo writes:

<<I keep reading about long-term care insurance. Does anyone own any or have an opinion about it?>>

I asked my mother to look into it recently. She is single and 72, and while I love her, I would prefer not to be responsible for bathing and feeding her if she ever needs that.

After speaking with several agents, she decided that the cost of the insurance was simply to high. It would be about $2,500 a year, and would only be available to her for a maximum of two years. If over the course of the next 20 years she never needed it (and her mom lived until 94), she will have spent $50,000 for nothing.

Therefore, she adopted an alternative plan. Each year on her birthday, she is going to take that $2,500 and invest it. Assuming an annual average return rate of 11% (the long term S&P average) at the end of 20 years, that money will have grown to $180,663. That amount will most certainly cover my mom for 2 years of care.

Of course, if something happens earlier, the whole scenario is moot. But she does have her retirement money if something dreadful occurs.

Either way you slice it, it's risky. Every person has to go with the scenario that feels most comfortable.

I also recommend reading TMF Pixy's series on the matter:

Fool on!

Barbara Eisner Bayer
TMF Venus

Print the post  


What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and Glassdoor #1 Company to Work For 2015! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.