No. of Recommendations: 1
Yes, I agree with all these things. The one that would most concern me is slightly different. What if you've been paying the premium for X years, but then something bad happens--like you lose your job--and you can't afford to pay the premium for a couple of years.
Do you lose your policy? Do they let you make it up?

I don't know. What happens if you lose your job and you cannot pay your house insurance or your car insurance? I think you have to get a new policy, and I'd expect to have to do the same with LTC. I don't understand the insistence that the LTC insurance should operate under different rules than any other type of insurance.

Now, in my case, I just went back to work after being out of work for 51 weeks. This is the 3rd time in the past 12 years that I have been unemployed, and was also the longest. During that time, DH also had rotator cuff surgery and was not bringing in any money for about 4 months as he is self-employed. I also have twins in college who get virtually no financial aid [DS gets a very small merit scholarship], but since we moved their college money to cash when they were in high school, we continued to use that to pay their college expenses.

During that time, we didn't miss a beat, although I do admit to borrowing $5k from their (overfunded) college account to pay expenses during that time, but that's because that's where the cash was, and I didn't want to sell stock if I didn't have to.

I am not concerned that I will not be able to pay the premium in case of job loss, and that's because we've been saving forever for our retirement which we expect to completely self-fund, although some social security would be nice. So I do have this nice, big pot of money that I can tap for things like paying the mortgage, the house taxes, and even the LTC premiums in case of unemployment. We also expect to retire in a maximum of 5 years, so we're pretty close to having to tap our nest egg.

I also have the LTC premiums included in my written retirement budget that tracks our expected expenses and how much we need to have set aside to generate our required annual 'income' at a 4% withdrawal rate, so I'm not worried about not being able to afford the premiums. There are plenty of discretionary expenses in that budget that can be cut to pay for essentials if needed, and I do consider this an essential for us.

As I said before, everyone's situation is different, and yes, you need to plan for all of these things. I think I have done that, and will stay the course. I also realize that the things I consider retirement essentials (golf, dining out, LTC premiums, travel to see the kids) may not be the same things that other folks consider essentials.

Once again, YMMV.
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