What Will Be Sacrificed

Many believe that if they need long term care, either in their home or in a facility, that the cost will be covered by provincial health care or other government agencies. While there are certain programs available, a significant portion of these costs are the responsibility of the patient.

Ted and Martha had been retired for about ten years when Martha developed a cognitive impairment. Ted was able to look after her for a little over a year, but then Martha had to be moved to an extended care facility. The monthly cost of $2,500 meant Ted had to draw an additional $46,000 per year, before taxes, from his RRIF. Less than five years later, Ted's RRIF ran dry.

John and Ellen retired in their early sixties. After just a few months of traveling and visiting with their grandchildren, Ellen's parents were no longer able to look after themselves and asked them for help. John and Ellen extensively renovated their home so they could accommodate them.

Within weeks of them moving in, Ellen became a full-time care provider for her father who was injured in a bad fall. John went back to work to help cover some of the additional costs.

In another situation, Kathleen is concerned about the spiraling costs, and often limited availability, of long-term care facilities. She became aware first-hand of these costs as her mother and an uncle had lived in nursing homes. Her mother's savings were quickly wiped out and Kathleen's uncle had to sell his home.

The last thing Kathleen wants is to deplete her savings or become a burden on family and friends. She doesn't want the lives of her loved ones disrupted along with hers if she can't look after herself. But where will the money come from if it becomes necessary for her to get long term care?

A better way to cover these costs can be found in Long Term Care Insurance. Generally available to people between the ages of 30 and 80, it pays a benefit directly to the insured when health or personal care services are required by order of a physician.

Some conditions must be met before a benefit will be paid. Typically, a policy will pay a benefit if the insured loses the ability to care for him or herself due to cognitive impairment or the inability to do two or more activities of daily living (ADLs). ADLs are: bathing, eating, dressing, toileting, transferring and maintaining continence.

Long Term Care Insurance protects your retirement assets, your spouse's retirement, your childrens' inheritance. More importantly, it protects your independence, quality of life, freedom of choice, and dignity.

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