Planning for long term care is a task most people like to avoid if at all possible. But putting it on the back burner is a mistake that can cost you and your loved ones dearly in the future. Between sorting through the type of care and level of care needed, to understanding the true cost of your unique situation, planning for a long term care event can be overwhelming. Read on to learn more about the cost of long term care in North Carolina, how it compares to the national average, and what you can do to plan ahead.
What Is Long Term Care and How Much Does it Cost?
Long term care is required when a person can no longer perform the basic activities of daily living on their own. This includes eating, bathing, using the toilet, transferring from one place in the house to another, continence, and dressing. As much as we don’t want to think about losing the ability to care for ourselves, this is a very common occurrence among older adults. In fact, nearly 70% of people turning 65 this year will need long term care services at some point in their lives.
When a person’s ability to care for themselves deteriorates beyond a certain point, long term care provides a collection of services to assist and help that person live as independently as possible. Long term care can include a range of services:
- Homemaker services
- Home health care
- Nursing home care
- Skilled nursing care
- Assisted living
- Adult daycare
In terms of cost, location and type of service required play the biggest role in how much you’ll pay for long term care.
The table below outlines the average cost of different levels of care in North Carolina based on the Genworth Cost of Care Survey:
|Type of Care
|Monthly Median Cost in 2023
|Adult Day Health Care
|Homemaker Services and/or Home Health Aide
|Assisted Living Facility
|Nursing Home: Semi-Private Room
|Nursing Home: Private Room
Compared to the national average of $9,584 for a private room in a nursing home, the cost of long term care in North Carolina is on the less expensive end of the spectrum. That’s great news for older adults living in North Carolina, but it doesn’t make planning for long term care any less important.
Misconceptions About Long Term Care
Before discussing how to pay for long term care, it’s important to clarify some misconceptions. A number of people mistakenly assume that Medicare—the health insurance program offered to people over the age of 65—pays for long term care costs. Unfortunately, that is not the case. Medicare does not cover long term care expenses or those costly nursing home stays.
Another significant misconception is that a spouse or child will be able to take care of you. In all likelihood, your spouse, who at that time may also be in their 70s, 80s, or 90s, won’t physically be able to do the necessary work to maintain your care. And while your children may be close by, they may be too busy with their own lives. With their responsibilities, it may be difficult to give you the care you need. Hoping that family or friends can take care of these important functions is a risky bet that is better avoided.
Older women are particularly vulnerable to the costs of long term care, as they are more likely to outlive their spouses and require longer term care than men. Not only that, but women who have gone through a divorce or separation are more likely to have fewer resources to handle paying for these costs. Thinking it’ll never happen to you is far from the best solution.
Options to Pay for Long Term Care
If thinking about paying for these costs on your own feels overwhelming, you have options. The three most common options include:
- A stand-alone long term care insurance policy
- Addition of a long term care rider to a life insurance policy
- Long term care add-on to a fixed or indexed annuity
Stand-alone policies have been decreasing in popularity because the annual premiums can be quite expensive and the policies usually offer no cash benefit to survivors if the long term care services aren’t used. However, stand-alone policies may be a good option for those who can afford the premiums and are relatively sure they’ll need long term care coverage later in life.
Two better options might be to add long term care insurance to existing policies already owned. If you have a permanent life insurance policy, many insurers offer an add-on called a long term care rider. For an additional premium, the rider may come with death benefits.
And if you own an annuity, you may be able to purchase a similar add-on in which additional amounts would be added to your monthly annuity income if you ever need to pay for nursing home costs or other long term care services.
How We Can Help
Finally, we hope you enjoyed this information on the cost of long term care in North Carolina. Facing the reality of long term care can be overwhelming for most. The good news is you don’t have to make these decisions alone. At Calamita Wealth Management, we are here to help you understand your options so you can make the best decision for your family. Schedule an introductory phone call using our online calendar or reach out to us at (704) 276-7325 or firstname.lastname@example.org.
Todd Calamita is the founder and managing principal of Calamita Wealth Management. This is an independent, fee-only wealth management company located in Charlotte, NC. Calamita Wealth serves people locally and across the country, that focuses on providing wealth management solutions to affluent individuals over age 50 and their families. He has more than 20 years of experience in the financial services industry. Todd Calamita is passionate about helping people have a better life. He does this by designing and implementing customized financial plans that bring clarity and confidence.
Todd is a CERTIFIED FINANCIAL PLANNER™ and CERTIFIED DIVORCE FINANCIAL ANALYST® professional. His educational background includes a Bachelor of Business Administration from Ohio University. He also received a Master of Business Administration from the Weatherhead School of Management at Case Western Reserve University. Aside from planning, he authored, Plan Smart: Conquering 10 Common Money Traps. Todd also wrote numerous articles on wide-ranging personal finance topics, from taxes to retirement accounts. He was featured in a Financial Boot Camp TV series as a volunteer. There he was showing people how to make smart decisions with their money. When not working, you can find Todd spending time with his wife, Teresa, and their two sons, Colin and Cameron. He enjoys rock climbing, swimming, and traveling. Todd even has a black belt in Tang Soo Do, a Korean martial art. To learn more about Todd, connect with him on LinkedIn.