Most Chevron employees (along with the general public) think of long-term care as nursing-home care, but most of the people who need long-term care need it in their own homes or in assisted living. Nursing homes are only one part of the picture. About 70% of the population over age 65 will need some type of long-term care during their lives1 whether in a nursing home, assisted-living facility or at their own home. The latter two alternatives – while usually less expensive than nursing-home care – are by no means cheap. In 2016, the average cost of a private room in an assisted-living facility in the California was $4000 per month.2 Round-the-clock care at home can also add up fast and that doesn’t even compare to the cost of nursing homes. In 2016, the average cost in California for a semiprivate room in a nursing home was $7,604 per month, and a private room was $9,338 per month.2 Many Chevron employees are great savers, but at that rate, it wouldn’t take long to put a sizable dent in the most solid of nest eggs. Even if you’re in good health now, there is no guarantee that will always be the case.
If you have $10 million in assets, you may not need long-term care insurance. But $5 million may not be enough, as comfortable as it seems, especially if half of those assets are locked up in illiquid assets such as real estate or if you want to leave as much of your estate as possible to your heirs. The government adds an incentive in terms of partially tax-deductible premiums (the exact amount varies from people age 41 to over age 70).
Please contact us at (925) 659-8020 with specific questions or to schedule a time to meet in our San Ramon, CA or Houston, TX offices.