Can I Self-Insure Against the Risk?

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Hypothetical Annual Premium of $3,203 1
Premium Saving at 4%
33% Tax Bracket 		Age Annual Cost of Care
5% Inflation
$3,203
52
$127,750
$6,492
53
$134,138
$9,869
54
$140,845
$13,336
55
$147,887
$16,896
56
$155,281
$20,552
57
$163,045
$24,306
58
$171,197
$28,160
59
$179,757
$32,118
60
$188,745
$36,182
61
$198,182
$40,355
62
$208,091
$44,640
63
$218,496
$49,039
64
$229,421
$53,556
65
$240,892
$58,194
66
$252,937
$62,957
67
$265,584
$67,847
68
$278,863
$72,868
69
$292,806
$78,024
70
$307,446
$83,318
71
$322,818
$88,754
72
$338,959
$94,336
73
$355,907
$100,067
74
$373,702
$105,952
75
$392,387
$111,995
76
$412,006
$118,199
77
$432,606
$124,570
78
$454,236
$131,111
79
$476,948
$137,828
80
$500,795

After 28 years of saving, you  have accumulated approximately enough money to pay for only 3.3 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 ($1,364,557.00) of exposure.

Every year in addition to the average 3 Year need will cost you an additional $500,795 per year.

1. Interest credited at the end of the year. Hypothetical premium based on $350/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