No. of Recommendations: 1
There are arguments for and against LTCI - You will have to address and consider those. But your idea that buying LTCI at age 41 might be a good idea because the cost will be lower is flawed in my view. As far as I know the inflation factors for LTCI max out at 5% compounded. Costs of medical care are increasing at a rate will over 5%. What you care about is money when you need it. The general rule I have seen is purchase in your fifties.

We are responsible for a friend who had a stroke in 1998. Her care costs $6,500 a month and that is Assisted Living, not a nursing home. If a person is unlucky like our friend you could easily have 20 years. The averages however are surprising to most people. While the sales people like scare people with data like 50% or 70% or some high number will be in a nursing home, they fail to tell the whole story. On average nursing home patients are there less than 100 days. To be sure part of that is the limit on Medicare payment. But lets be honest -- people die in nursing homes. They do not go there because health is perfect. Another common reason for nursing home use is rehab. If you have a hip replacement and live alone, it is likely you will spend a week or two in a nursing home before returning to your residence. Nursing homes cost a whole lot less than a hospital.

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