How to write an online will

Dear Savvy Senior: My wife and I have thought about purchasing a long-term care insurance policy, but we hate the idea of paying expensive monthly premiums for a policy we may never use. Is there a good rule of thumb on who should or shouldn’t buy long-term care insurance? —

Getting Old

Dear Getting: There are two key factors you need to consider that can help you determine if purchasing a long-term care insurance policy is a smart decision — your financial situation and health history. Currently, around 8 million Americans own a policy.

As the cost of LTC — which includes nursing home, assisted living and in-home care — continues to rise, it’s important to know that most people pay for LTC either from personal savings or Medicaid when their savings is depleted, or through a LTC insurance policy. National median average costs for nursing home care today is around $92,000 per year, while assisted living averages around $50,000/year.

While national statistics show that about 70 percent of Americans 65 and older will need some kind of LTC, many people don’t need to purchase a LTC insurance policy.

The reasons stem from a range of factors, including the fact that relatively few people have enough wealth to protect to make purchasing a policy worthwhile. Seniors with limited financial resources who need LTC turn to Medicaid to pick up the tab after they run out of money.

Another important factor is that most seniors who need LTC only need it for a short period of time, such as when recovering from surgery. For those people, Medicare covers in-home health care and nursing home stays of 100 days or less following a hospital stay of more than three consecutive days.

So, who should consider buying a policy?

LTC insurance policies make the most sense for people who can afford the monthly premiums, and who have assets of at least $150,000 to $200,000 or more that they want to protect, not counting their home and vehicles.

Another factor to weigh is your personal health and family health history. The two most common reasons seniors need extended long-term care is because of dementia and/or disability. Almost half of all people who live in nursing homes are 85 years or older. What’s your family history for Alzheimer’s, stroke or some other disabling health condition, and do you have a family history of longevity?

You also need to factor in gender. Women tend to live longer than men and are at greater risk of needing extended LTC.

After evaluating your situation, if you’re leaning toward buying a LTC policy, be sure to do your homework. The cost of premiums can range between $2,500 and $8,000 per year for a couple depending on age, the insurer and the policy’s provisions. Because of coronavirus, it may be more difficult to qualify for coverage if you’re age 70 or older, in a high-risk group or have had a positive COVID-19 test.

To find a policy, get a LTC insurance specialist who works with a variety of companies. Visit the American Association of Long-Term Care Insurance website at Shop insurers like Northwestern Mutual and New York Life, who work only with their own agents.

Another option you may want to consider are hybrid policies that combine long-term care coverage with life-insurance benefits. These policies promise that if you don’t end up needing long-term care, your beneficiaries will receive a death benefit.

Send your senior questions to: Savvy Senior, P.O. Box 5443, Norman, OK 73070, or visit Jim Miller is a contributor to the NBC Today show and author of “The Savvy Senior” book.