Can I Self-Insure Against the Risk?

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Hypothetical Annual Premium of $2,013 1
Premium Saving at 4%
33% Tax Bracket 		Age Annual Cost of Care
5% Inflation
$2,013
52
$80,300
$4,080
53
$84,315
$6,202
54
$88,531
$8,381
55
$92,958
$10,619
56
$97,606
$12,917
57
$102,486
$15,276
58
$107,610
$17,698
59
$112,990
$20,185
60
$118,640
$22,739
61
$124,572
$25,361
62
$130,801
$28,054
63
$137,341
$30,819
64
$144,208
$33,658
65
$151,418
$36,573
66
$158,989
$39,566
67
$166,938
$42,639
68
$175,285
$45,795
69
$184,049
$49,035
70
$193,251
$52,362
71
$202,914
$55,778
72
$213,060
$59,286
73
$223,713
$62,888
74
$234,899
$66,586
75
$246,644
$70,384
76
$258,976
$74,283
77
$271,925
$78,287
78
$285,521
$82,398
79
$299,797
$86,619
80
$314,787

After 28 years of saving, you  have accumulated approximately enough money to pay for only 3.3 months of care.

If you were faced with the average 3 Year Long-Term Care need2, even under the optimal saving conditions shown above, you would have ($857,742.00) of exposure.

Every year in addition to the average 3 Year need will cost you an additional $314,787 per year.

1. Interest credited at the end of the year. Hypothetical premium based on $220/Day, 100% Home Health, Three Year Benefit Period, 3% Compound Inflation Rider and 90 Day Elimination Period with Spousal & Preferred Discounts. Policies vary, consult your agent about specific plan design and premiums for your individual situation.

2. National Clearinghouse for Long-Term Care Information, "How Much Care Will You Need?" June 2012