Is it too early for me to purchase long-term care insurance?

Long-term care insurance is a crucial form of coverage that can shield you from significant financial challenges in your later years. The array of services one might require as they age, from nursing home care to assisted living and occupational therapy, often comes with substantial costs that may exceed what most people can comfortably afford.

Fortunately, long-term care insurance enables you to pay a premium for coverage that can offset these expenses in the future. However, the timing of when to acquire long-term care insurance is crucial. According to Nick Covyeau, a financial advisor with Swell Financial, it’s a delicate balance: “You don’t want to purchase your policy too early, as you may end up paying premiums for more than two decades before potentially filing a claim. But you also don’t want to wait too long and experience a significant increase in your premiums.”

Here’s a guide to help you determine whether you’re at the right age to consider purchasing long-term care insurance:

1. Start looking in your 50s or 60s: Typically, individuals in their 50s and 60s are advised to contemplate acquiring long-term care insurance. Financial advisor Covyeau suggests broaching the topic with clients in their late 50s. Purchasing the policy at a younger age may result in paying premiums for an extended period before the likelihood of filing a claim, leading to unnecessary costs.

2. Don’t wait too long: While it’s possible to buy long-term care insurance too early, waiting too long can also have drawbacks. As you age, premiums tend to increase, and insurance companies may require a health exam, with potential health issues further raising costs or hindering coverage approval. The optimal window for considering long-term care insurance is generally in your 50s and 60s—old enough to qualify for affordable premiums but not so late that you end up paying for an extended period.

In conclusion, if you’re under the age of 50, purchasing long-term care insurance might not always be the most sensible decision. Comparing prices and assessing future costs is prudent, but acquiring coverage too early could result in unnecessary premium payments. Conversely, if you’re in your 50s, delaying the decision might lead to increased costs or potential unavailability of long-term care insurance. Balancing the timing is essential to securing coverage that suits your needs and financial circumstances.