The Retirement Threat No One Sees Coming—Until It’s Too Late

You’ve done everything right. You’ve saved diligently, invested wisely, and built a retirement plan designed to last. But there’s one major risk that could unravel even the best-laid financial plans—an unexpected long-term care event.

Most people don’t like to think about it. After all, retirement is supposed to be about enjoying life, not worrying about what happens if you need help with daily activities. But the reality is stark: a long-term care event can drain your retirement savings faster than almost any other financial setback.

Let’s break down what this means, who’s most at risk, and—most importantly—how you can protect yourself.

What Is a Long-Term Care Event?

A long-term care (LTC) event occurs when a person can no longer independently perform essential daily activities such as:

• Bathing
• Dressing
• Eating
• Using the restroom
• Moving from a bed to a chair

This can happen due to aging, illness, cognitive decline (like Alzheimer’s), or an unexpected injury.

When that day comes, you’ll need care—and it won’t be cheap.

Who’s Most at Risk? Women Face a Higher Burden

While long-term care is a potential concern for everyone, women are especially vulnerable. Why?

• Women live longer than men. On average, women outlive men by about five to six years. More years = a greater chance of needing care.
• Women are more likely to live alone in later years. Without a spouse to provide care, they must rely on paid care services or family members.
• Women are more likely to develop Alzheimer’s or dementia. Nearly two-thirds of Americans with Alzheimer’s are women.

How Much Does Long-Term Care Cost?

Here’s where things get serious. Long-term care isn’t just expensive—it’s financially devastating for many families.

According to Genworth’s 2024 Cost of Care Survey, here’s what you can expect to pay per year:

If you need care for just three years, that’s easily $250,000 to $400,000 or more—and Medicare won’t cover most of it.

Financial Protection Strategies: How to Prepare for a Long-Term Care Event

1. Self-Funding (Paying Out-of-Pocket)

• Pros: No insurance premiums, full control over care choices.
• Cons: Requires hundreds of thousands of dollars in savings; could drain your retirement assets quickly.

2. Traditional Long-Term Care Insurance

• Pros: Covers a large portion of LTC costs, preserving retirement savings.
• Cons: Expensive premiums (which increase over time), “use it or lose it” risk—if you never need care, you don’t get your money back.

3. Medicaid (Government Assistance Program)

• Pros: Covers nursing home care and some home care services.
• Cons: Requires spending down most of your assets to qualify; limits your care options significantly.

4. Hybrid Long-Term Care Policies (Life Insurance with LTC Rider) – Palmer Financial Wellness’s Recommended Solution

A permanent life insurance policy with a Long-Term Care (LTC) rider allows you to access your death benefit while still alive to cover long-term care costs.

• Pros:

• ✅ If you don’t need long-term care, your family still gets the full life insurance payout.
• ✅ Premiums never increase.
• ✅ Flexibility: You can use the money for home care, assisted living, or a nursing home.

• Cons:

• ⚠️ You must qualify for coverage while you’re still healthy (the best time to plan is before you need care).
• ⚠️ Can be more expensive than traditional life insurance, but provides far more value and protection.

Final Thoughts: Plan Ahead—Before It’s Too Late

A long-term care event can wipe out a retirement fund in a matter of years. The key is to plan before you need care—because by the time you do, your options will be limited.

At Palmer Financial Wellness, we help individuals and families protect their retirement from the financial risks of long-term care. We strongly recommend leveraging a life insurance policy with an LTC rider—it’s a smart, flexible way to ensure you’re covered no matter what happens.

Want to safeguard your retirement? Let’s talk.