Why seniors should apply for long-term care insurance before 2025

In the final weeks of the year, many Americans may find themselves doing a retrospective look at their economic health with an eye toward what can be improved in 2025. A variety of economic factors affected Americans this year, ranging from a significant drop in inflation to multiple interest rate cuts to multiple record-breaking days on the stock market. And while these elements, on the surface, are all positive, it will still take some time to recuperate from the inflationary period of recent years. And this will require smart decision-making, particularly for seniors with a limited budget.

This will extend to a review of their insurance protections, both what they require and what they may be able to comfortably eliminate or reduce coverage on. For many, a long-term care insurance plan could be worthwhile. This unique policy can cover costs associated with nursing homes, assisted living facilities and in-home caretakers, among other features. But the timing surrounding an application is critical to get right. And in the final weeks of the year, there’s a compelling case to be made for applying for long-term care insurance now, before 2025. Below, we’ll explain why.

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Why seniors should apply for long-term care insurance before 2025

Are you a senior considering a long-term care plan now? Or are you exploring the benefits for a family member or loved one? Here are three reasons why it’s worth applying for before January 1, 2025:

Premiums will rise

Long-term care insurance works similarly to other traditional insurance policies in the sense that it becomes more expensive the older you are. So if you wait for a new calendar year to apply, you’re likely to spend more for a policy than you would have if you started the paperwork in November or December. This is why applicants in their 50s and 60s often secure lower premiums than those in their 70s (among other factors). Waiting for an ideal time to apply, then, could cost you more than you had anticipated (or can afford to budget for). Consider acting promptly, instead.

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Care will become more expensive

The costs of nursing homes and assisted living facilities are only expected to increase over time, underlining the importance of securing a robust insurance plan now, in advance of that rise. According to Genworth’s Cost of Care survey, the monthly median price of a home health aide in 2024 is $6,481 while an assisted living facility is $5,511 while a nursing home with a private room starts at $10,025. Those costs are all predicted to rise in 2025 to $6,675, $5,676, and $10,326, respectively. It makes sense, then, to start exploring insurance options now before the costs of these services become unmanageable.

Unforeseen economic factors could impact your ability to pay for help

You may feel that you have the economic means to pay for this care in the future, rendering a long-term care insurance policy ineffective. But as has been seen in recent years, unforeseen economic factors could impact your ability to pay for help, potentially even in the final weeks of the year. 

Inflation rose in October, after all, and if it rises again in November the interest rate cuts once predicted with high certainty for December could be paused – or rates could even rise. This will make everyday borrowing more expensive, reducing your budget to pay for items that a long-term care insurance policy can help cover. So weigh these unknowns carefully versus the benefits of simply locking in protection right now.

The bottom line

The benefits of a long-term care insurance policy are substantial. To make a plan truly cost-effective seniors should time their application carefully. For many, this may mean acting before 2025 to get ahead of policy cost increases. As with all insurance policies, however, it’s critical to weigh the costs versus the benefits to determine the true value, particularly in today’s evolving economic climate. So start by speaking with a long-term care provider who can answer your questions.

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