Most people spend decades saving for retirement — building up their 401(k), maximizing Social Security benefits, and planning for the life they’ve always envisioned. But one of the most significant financial risks in retirement rarely gets the same attention: the potential need for long-term care.
According to the U.S. Department of Health and Human Services, roughly 70% of Americans who reach age 65 will need some form of long-term care services at some point in their lives. Yet most people either assume it won’t happen to them, believe Medicare will cover it, or simply put off planning until it becomes a crisis.
The good news is that you don’t have to be caught off guard. Here are five signs that you may need a long-term care plan — and what you can do about it right now.
Sign #1: You’re in Your 50s or Early 60s and Haven’t Thought About It Yet
If the topic of long-term care hasn’t crossed your mind, that’s actually one of the clearest signs you need a plan. Long-term care planning is most effective — and most affordable — when you start early.
Long-term care insurance premiums are based heavily on age and health. A 55-year-old in good health will qualify for significantly better rates than a 68-year-old with a few health conditions on their record. By the time most people “feel ready” to address long-term care, they may already face limited options or higher costs.
The window of opportunity is real. Waiting isn’t neutral — it’s a decision that can close doors.
What to do: Schedule a conversation with a financial advisor to review your current retirement income plan and determine whether a long-term care strategy belongs in the picture. Even if coverage isn’t the right fit today, understanding your options puts you in a far stronger position.
Sign #2: You Have a Family History of Chronic Illness or Cognitive Decline
Genetics aren’t destiny, but they do matter when it comes to long-term care planning. If parents, grandparents, or siblings have experienced Alzheimer’s disease, dementia, Parkinson’s disease, stroke, or other conditions that required extended care, your statistical risk is elevated.
Beyond personal health history, think about what you witnessed. If a parent needed years of home health aide support, memory care, or nursing home placement — and you saw firsthand what that cost emotionally and financially — you understand better than most why a plan matters.
The average cost of memory care in a facility in the Midwest now exceeds $5,000–$6,000 per month, and skilled nursing care can run considerably higher. Without a funding strategy in place, those costs fall directly on retirement savings or family members.
What to do: Have an honest conversation with your doctor about your health history and risk factors. Then bring that context to your financial planning conversation. Solutions like indexed annuities with long-term care riders, hybrid life/LTC policies, or traditional LTC insurance can be tailored to your specific situation and risk profile.
Sign #3: You’re Planning to Retire on a Fixed Income
Retirement income planning is all about predictability. You want to know that your essential expenses — housing, food, healthcare, utilities — are covered no matter what. But a long-term care event has the potential to completely disrupt even a well-designed retirement income plan.
Consider this: if your monthly income is $4,500 and a home health aide suddenly costs $3,000–$4,000 per month on top of your regular living expenses, where does that money come from? Many retirees find themselves dipping into savings they intended to last 20–30 years, sometimes depleting assets within just a few years of a significant care event.
For retirees in Northwest Indiana and the greater Chicagoland area, the cost of care has continued to rise steadily, and local caregiving resources — while excellent — are not free.
What to do: As part of your retirement income floor strategy, identify which expenses are fixed and which are variable. Then stress-test your plan against a realistic long-term care scenario. A fiduciary advisor can help you model this without any product bias.
Sign #4: You’re Counting on a Spouse or Family Member to Be Your Caregiver
“My spouse will take care of me” or “my kids won’t let me go to a nursing home” are two of the most common assumptions in retirement planning — and two of the most financially dangerous ones.
Spousal caregiving is physically and emotionally demanding. Many spousal caregivers develop their own serious health issues as a direct result. And when both spouses need care simultaneously — which is more common than people expect — there’s no backup plan.
Adult children face their own financial and logistical realities: careers, their own families, mortgages, and often geographic distance. Relying on family caregiving without a financial infrastructure to support it places enormous strain on relationships and frequently leads to rushed, emotionally charged decisions made under crisis conditions.
What to do: Have a transparent conversation with your family about expectations — on both sides. Then work with a financial advisor to build a plan that provides real options, not just hopes. Funded long-term care strategies protect both you and the people you love from having to make impossible choices.
Sign #5: You Haven’t Reviewed What Medicare Actually Covers
One of the most persistent myths in retirement planning is that Medicare will pay for long-term care. It will not — at least not in the way most people assume.
Medicare covers short-term skilled nursing care following a qualifying hospital stay of at least three consecutive days, and even then, only for a limited period. After 20 days, significant daily co-pays apply. After 100 days, Medicare coverage ends entirely. Medicare does not cover custodial care — the kind of ongoing assistance with bathing, dressing, eating, and mobility that most long-term care recipients actually need.
Medicaid does cover long-term care, but only after you have spent down most of your assets to meet eligibility requirements. For many pre-retirees and retirees who have spent a lifetime saving, Medicaid planning requires careful advance coordination with an elder law attorney — and the rules around look-back periods and asset transfers are strict.
What to do: Get a clear picture of your Medicare coverage and understand exactly where the gaps are. If you’re approaching Medicare eligibility, this is also an ideal time to review your Medicare supplement or Advantage plan options. A comprehensive retirement plan accounts for healthcare costs — including the potential for long-term care — rather than assuming they’ll be covered.
So What Are Your Options?
There is no single “right” solution for long-term care planning — the best approach depends on your age, health, assets, income, family situation, and risk tolerance. The most commonly used strategies include:
Traditional long-term care insurance, which provides a dedicated daily or monthly benefit for qualifying care expenses. Premiums are generally tax-deductible for self-employed individuals and may qualify for state tax incentives.
Hybrid life insurance with long-term care riders, which combine a permanent life insurance death benefit with a long-term care benefit. If you never need care, your beneficiaries receive the death benefit. If you do need care, the policy pays out for covered services. These have become increasingly popular because the premium is not “use it or lose it.”
Fixed indexed annuities with long-term care or confinement care riders, which can double or increase income distributions when a qualifying care event occurs. These may be appropriate for clients who are concerned about health insurability or who want a retirement income vehicle with a built-in care benefit.
Self-insuring, which is a legitimate strategy for individuals with significant liquid assets — but only when done deliberately, with a realistic estimate of potential costs and a clear funding source identified in advance.
Medicaid planning in coordination with an elder law attorney, which is appropriate for individuals who may not have sufficient assets to fund care privately and want to structure their finances accordingly.
A Note on Timing
One thing every long-term care planning conversation has in common: the people who are most satisfied with their options are the ones who planned early. Waiting until you have a diagnosis, until your spouse is already in crisis, or until premiums have become cost-prohibitive doesn’t give you less to worry about — it gives you fewer choices.
At Patten Financial Group, we work with pre-retirees and retirees across the Valparaiso and Northwest Indiana area to build retirement income plans that account for the full picture — including the costs and risks most people would rather not think about. We believe that a plan that ignores long-term care isn’t really a retirement plan at all.
Ready to Take the Next Step?
If any of the five signs above resonated with you, we’d like to invite you to schedule a complimentary Retirement Income Review. During this no-obligation conversation, we’ll take a close look at where you stand today, identify any gaps in your current plan, and walk through options that may make sense for your situation.
There’s no pressure and no sales pitch — just a straightforward conversation about your goals and how to protect them.
To schedule your complimentary review, contact Patten Financial Group at our Valparaiso office or visit us online. We serve clients throughout Porter County, Lake County, and the greater Chicagoland area.
[This article is intended for informational purposes only and does not constitute investment, legal, or tax advice. Long-term care insurance and annuity products involve risks and costs that should be carefully reviewed. Please consult with a qualified financial advisor, tax professional, and/or attorney regarding your specific situation.]
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