Even though many Americans are aware they will likely need long-term care down the road, many are dragging their feet when it comes to actually preparing for their future health requirements, shows Genworth’s 2011 Financial Reality Check Study.
Circumstances that triggered survey respondents to looking into buying a long-term care policy include knowing someone who experienced a serious illness or life-threatening event, being advised by a financial planner, or reaching a certain age.
For those who experienced these “life events,” it look less than five months for 52% of respondents to begin the purchase process.
Nearly half of respondents believe they will end up giving care to friends or family, but 75% said they haven’t had a conversation about long-term care planning in the past year.
Despite many seniors’ retirement funds taking a hit thanks to the recession, 68% of those surveyed didn’t decide to create a new plan or increase the frequency with which they met with a financial professional since the financial crisis in 2008.
Just under 40% of Americans take time at least once per month to examine their financial situation, while a majority, at nearly 90%, do so at least once per year.
In terms of what people planned to add to their financial plans in the next two years, a majority 43% did not plan to add anything and chose none of the available options, which included a reverse mortgage (0%), long-term care insurance (7%), IRAs (17%), and 401(k)s (21%).
Less than half of respondents, at 38%, thought they were either somewhat or extremely likely to need long-term care one day. Reasons for those who said they didn’t need long-term care insurance ranged from being young and healthy, not being able to afford it, planning on their children to provide care, or feeling they wouldn’t live long enough to need long-term care.
Among those who do believe they need long-term care insurance, many cited security, personal experience with providing care to others, and not wanting to be a burden as reasons.
View the Genworth study here.
Written by Alyssa Gerace