Beyond the Myths: What You Really Need to Know About Long Term Care Planning

Most people believe a government program will cover their long term care needs. The reality? It won’t—and waiting until you need care to discover this can create both financial strain and emotional stress for everyone involved.

During a recent educational webinar, Beau Henderson of RichLife Advisors welcomed long term care specialist Richelle Collazo to address the myths, facts, and practical strategies surrounding one of retirement’s most overlooked risks: unexpected health events requiring extended care.

Why Long Term Care Planning Deserves Your Attention

Long term care planning sits at the heart of what Beau calls the ROUTE retirement model—a holistic framework covering Risk management, Optimized income planning, Unexpected healthcare expenses, Tax planning, and Estate planning. While many retirees focus primarily on portfolio growth and Social Security optimization, the “U” in ROUTE—unexpected healthcare expenses—often catches families unprepared.

“We want to be at an eight, nine, or ten on the confidence scale for all five areas,” Beau explained. “That means we’re well-prepared, well-informed, and we’ve made intentional decisions about how to handle long term care—not scrambling during a crisis.”

Dispelling the Seven Myths

Richelle, who has specialized in long term care since 2005, walked attendees through seven common misconceptions that prevent people from planning effectively:

Myth #1: Government programs will cover me. Medicare covers only short-term skilled nursing care following hospitalization—not the extended custodial care most people eventually need. Medicaid requires spending down assets to poverty levels before coverage begins.

Myth #2: I can save the money I’ll need for long term care services (self-funding)
Reality: While self-funding is an option, it requires significant liquid reserves and doesn’t provide the guarantees or additional benefits that asset-based long term care policies offer. With asset-based plans, you either use the benefits for care OR your beneficiaries receive a death benefit—so it’s never “wasted money.”

Myth #3: Only old people need long term care services
Reality: While 70% of people over 65 will eventually need care, claims can happen at any age. Rochelle shared examples ranging from a 38-year-old claimant to someone 103 years old. Accidents, illnesses, and disabilities can create care needs at any stage of life.

Myth #4: I don’t need separate long term care protection because I have health insurance
Reality: Health insurance and Medicare cover medical care—doctor visits, tests, procedures. Long term care insurance covers the hands-on personal care you need with activities of daily living (bathing, dressing, eating, transferring, toileting, continence).

Myth #5: Long term care protection pays for nursing home care only
Reality: 75-80% of long term care happens OUTSIDE of nursing homes—at home or in assisted living facilities. Modern policies also include care coordination, caregiver training benefits, respite care, and even bed reservation benefits.

Myth #6: I can’t afford long term care insurance
Reality: Today’s asset-based policies are highly customizable with flexible funding options—from single premium payments using qualified money (with bonuses!) to annual premiums. Plans can be tailored to fit virtually any budget while still providing meaningful protection.

Myth #7: We don’t need long term care protection because we have each other
Reality: While the sentiment is beautiful, the physical reality of caregiving is incredibly difficult—even for healthy, strong family members. A long term care policy allows loved ones to coordinate care and visit, rather than bearing the physical burden of lifting, transferring, and providing round-the-clock assistance.

The Statistics Are Clear: Research shows that approximately 70% of people over age 65 will need some form of long term care services during their lifetime. The national average cost for nursing home care now exceeds $108,000 annually, with assisted living facilities averaging $64,000 per year. Home health aides can cost $30-$35 per hour.

Three Strategic Approaches to Consider

Richelle outlined three primary methods for addressing potential long term care needs:

1. Self-Funding: Using existing assets to pay for care as needed—viable for some, but requiring significant liquid reserves and a clear plan for which assets to liquidate first.
2. Traditional Long Term Care Insurance: Policies designed specifically to reimburse long term care expenses, offering comprehensive coverage but requiring premium payments whether benefits are used or not.
3. Hybrid Life Insurance with Long Term Care Riders: Newer products that provide both death benefits and accelerated benefits for long term care, addressing the “use it or lose it” concern some have with traditional policies.

The Conversation You Need to Have

“Not everyone needs a long term care insurance policy,” Richelle emphasized. “But everyone needs a long term care plan.”

Even if you decide to self-fund, documenting your strategy is essential. Which assets will you liquidate first? What are your expectations of family members? Who will coordinate care? Making these decisions when you’re healthy and thinking clearly is dramatically different from navigating them during a medical crisis.

For married couples, Richelle addressed a common concern: “If one spouse doesn’t qualify for coverage, the other absolutely should still proceed. Protecting whatever assets you can benefits both of you—it’s like closing one window when a storm is coming, even if the other is stuck.”

Your Next Step

If you haven’t had a comprehensive long term care conversation, now is the time. The goal isn’t necessarily to purchase insurance—it’s to evaluate your options, understand the risks, and make an informed decision that aligns with your overall retirement strategy.

To schedule a long term care planning conversation with the RichLife Advisors team, contact us at 770-249-7424 or email info@richlifeadvisors.com. Let’s make sure this critical component of your retirement plan moves from “someday” to “handled.”

Because confidence in retirement means being prepared—not just for the best-case scenario, but for reality.

TIMESTAMPED HIGHLIGHTS:

00:58 – The 5 Critical Areas of Retirement

02:35 – Meet Long-Term Care Specialist Richelle Collazo

03:33 – Debunking 7 Long-Term Care Myths

13:11 – Current & Future Cost of Care in Georgia

16:12 – Asset-Based Long-Term Care Using IRA Funds

20:17 – Younger Adults & Unexpected Needs 27:07 –

Most Care Happens at Home

39:06 – Supporting the Caregiver

41:19 – Schedule Your Long-Term Care Conversation