Can I Self-Insure Against the Risk?

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Hypothetical Annual Premium of $1,647 1
Premium Saving at 4%
33% Tax Bracket
Age Annual Cost of Care
3% Inflation
$1,647
52
$65,700
$3,338
53
$67,671
$5,074
54
$69,701
$6,857
55
$71,792
$8,688
56
$73,946
$10,568
57
$76,164
$12,498
58
$78,449
$14,480
59
$80,802
$16,515
60
$83,226
$18,605
61
$85,723
$20,751
62
$88,295
$22,954
63
$90,944
$25,216
64
$93,672
$27,539
65
$96,482
$29,924
66
$99,376
$32,373
67
$102,357
$34,888
68
$105,428
$37,470
69
$108,591
$40,121
70
$111,849
$42,843
71
$115,204
$45,638
72
$118,660
$48,508
73
$122,220
$51,455
74
$125,887
$54,481
75
$129,664
$57,588
76
$133,554
$60,778
77
$137,561
$64,054
78
$141,688
$67,418
79
$145,939
$70,872
80
$150,317

After 28 years of saving, you  have accumulated approximately enough money to pay for only 5.7 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 ($380,079.00) of exposure.

Every year in addition to the average 3 Year need will cost you an additional $150,317 per year.

1. Interest credited at the end of the year. Hypothetical premium based on $180/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