Long-term care insurance can be expensive. Now, it can play a role, and I often still recommend it, but I don't believe in recommending it until after you have a clear understanding of what should you do. Should I get long-term care insurance? Should I self-insure? When does it make sense? And what are the pros and cons? So that's what I'm going to work through on today's podcast episode. Now, as a reminder,

my name is Ari Taublieb. I am a financial planner here at Root Financial Partners and the

vice president. And I love helping people retire early. So I'm going to hop right into today's

episode. And when you start thinking about long-term care and self-insuring and even hear about

these topics, when people are saying, should I self-insure or not, what they are referring to. And you might have heard a neighbor talk about this, or if you're hoping to retire early and you have a friend and they bring up maybe at lunch, hey, you know, have you looked into long-term care or maybe you have a parent and you've seen that experience and maybe you're going, all right, I really want to make sure I avoid, you know, having to worry about the burdens of future health implications, which we all do. And of course, I as a planner get to hear from many, many people constantly. And it's not too an annoyance, but it's to the point of it's important. Hey, we need to make sure if you're retiring early that you can bridge the gap from a health care perspective before Medicare kicks in, as well as making sure that for the long term, you're not kicking yourself going, oh my gosh, I did not plan well for these future long term care expenses and either we don't have enough or you're going, oh my gosh, I really should have done these other things, whether that be get a policy in place or a different account or you just want to make sure you don't look back and go, I wish I would have done X. So that's what we're going to make sure it does not happen. By the end of today's episode, you will have a very clear sense of what you need to do. Now, here's where I like to start, and if you've been listening to the episode for some time, many of these episodes, you know that I love examples. So here's the example I want to start with. There is a tool online, and it's with Genworth, and it's called the Genworth Cost of Care Calculator. And it's very cool, and you can play around with it for a long time. Now, I don't imagine your dream Friday night or Saturday night is playing around with the cost of care calculator. However, to each their own, of course. And I want you to know that it's an option there. And what I'm doing is I'm doing that work for you so that in three to four minutes, you'll see everything that you

would need to do if you were to go online. So on average, individuals who need long-term care, they tend to require it for about two and a half years. Now, of course, like I said, it's the average. It's not, of course, everyone, but I want you to know this is what I'm looking at as I'm going through this example.

So if we're going to typically show two and a half years of life,

I'm looking at as I'm going through this

example. So if we're going to typically show two and a half years of life, as you can imagine,

we need to understand, okay, what's not the cost for that just today, but cost for the future.

So I use the calculator, and I'm using the state of Indiana because the client who I had asked

the question to me was living in

Indiana and the projected annual cost of an assisted living facility in Indiana is, I'm going to

pause here and I like to let people guess because sometimes it's just fun but I'm going to

tell you the answer right now, which is $132,000 in 30 years. Now I'm assuming a 3% increase in cost each year. So if we assume that two and a half

years of this expense would add up to about $331,000. So now you're thinking, okay, all right,

that makes sense. Now, what could a long-term care policy do? Should I self-insure? Once again,

that concept of self-insuring is the idea, what if you paid those premiums to yourself in the case of what if you don't need long-term care for two and a half years? And otherwise, you could have used these funds to donate, to donate, excuse me, to a cause that you really care about, or just towards more legacy goals or things like that. So if you are planning

to go, okay, $331,000, yes, Ari, I want to plan on that average of two and a half years,

well, we need to think through how would we self-insure for that. So if you want to self-insure

that potential cost, you could do this very simply by earmarking assets in your portfolio for this

specific purpose. Now here's how it would work. Let's assume you get a 6% return on your investments.

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