Women generally live longer than men, which increases their likelihood of needing long-term care services. According to a 2022 report from the Health and Human Services Department, about 57% of Americans reaching age 65 will develop a disability requiring such care, with 26% of women needing it for over five years compared to 17.5% of men.
The average duration of care for women is 3.6 years, while for men it is 2.5 years. Financial experts emphasize that women often face the risk of outliving their spouses, leading to a depletion of shared assets used for the husband's care before they need assistance themselves. Medicare does not cover long-term care, leaving individuals to rely on personal savings, Medicaid, or insurance.
The costs for long-term care can be significant, with annual nursing home expenses exceeding $100,000. For instance, the median daily rate for a semi-private room in a nursing home is projected to be $315 in 2025, translating to nearly $115,000 annually.
Women typically pay higher premiums for long-term care insurance than men, with a healthy 55-year-old woman paying an average of $3,750 annually for $165,000 in coverage, compared to $2,200 for a man. Financial advisors recommend exploring various insurance options early, as waiting until health issues arise can lead to denial of coverage.
Hybrid policies that combine long-term care with life insurance are becoming more popular, offering benefits regardless of whether long-term care is needed. Shared policies between spouses can also help manage costs, although they come with the risk of one spouse exhausting the shared benefits first.
Overall, experts stress the importance of proactive planning for long-term care to ensure financial security in later life