Long-term care can cost retirees big-time—and more than half will need at least some LTC for at least part of their retirement.
That's according to a recent study from the Department of Health and Human Services' Office of the Assistant Secretary for Planning and Evaluation.
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In an ASPE issue brief, the Office of Disability, Aging and Long-Term Care Policy wrote that Americans as a group "underestimate the risk of developing a disability and needing long-term services and supports (LTSS)."
And the cost of that could be cripplingly high.
Fifty-two percent, the brief said, of Americans turning 65 now will need LTSS as the result of a disability. And while "most will need assistance for less than two years," that doesn't mean that assistance will come cheaply.
And they're the lucky ones, since one out of seven will have a disability for more than five years.
The average outlay in future LTSS costs, according to the brief, will be $138,000 for Americans turning 65 now. That amount could be financed, the report said, "by setting aside $70,000 today."
As if that's going to happen, when people aren't even saving enough for a retirement that assumes at least relatively good health and a corresponding lack of catastrophic medical expenses.
About half of that $138,000 is projected to be paid by families out of pocket, while public programs and insurance will take care of the rest.
Most, the study cheerfully pointed out, "will spend relatively little on their care," but for the rest? Well, 17 percent will fork over at least $100,000 for LTSS in the future.
Considering that the "typical person who is alive at age 65 can expect to live another 20.9 years," that's a long time to gamble on being among the lucky half of the population that won't need long-term care.
And the odds for a favorable outcome are substantially reduced for women, for whom the picture is considerably bleaker.
Women have longer periods of disability—2.5 years, compared to 1.5 years for men—and greater likelihood of developing a disability: 57 percent of women, compared with 47 percent of men. And an unlucky 18 percent of women will need care for at least 5 years.
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