Research options to fill the gap.
Whether or not you qualify for certain coverage under Medicare, you’ll likely need an additional resource to help balance benefits and costs. Those who have Medicare may want to consider a supplemental health insurance policy such as Medigap. It helps you pay for some of the costs Medicare doesn’t cover.
Another option is purchasing a long-term-care insurance policy, which may help you avoid, or at least reduce, the amount you might need to dip into your savings for related costs. The average stay in a long-term-care facility is four years, so if you don’t opt for long-term-care insurance, you may need to set aside roughly $250,000 to $400,000 to pay for it yourself, depending on your required level of care.
The two main forms of long-term-care insurance are traditional and hybrid. The traditional variety typically involves paying an annual premium and lets you choose how much coverage you want.
The hybrid option is a life insurance policy that allows a portion of the cash value of the policy to be used for long-term care. Beneficiaries can also receive a death benefit when you pass away. Death benefits will typically be reduced if long-term care benefits are used.
“Retirement planning is about understanding and mitigating the biggest risks,” Larson explains. Then you can decide how to address the risks so that you’ll feel comfortable about your future.