Man, things are real-life when you are a single woman. Nevermind if you're a single mom.
You could have a really great co-parent in your kids’ dad, remarry, make a ton of money with a successful business or career, inherit a bunch of dough and be all set when you retire — young enough to enjoy it.
That is my plan, and I do hope that is my reality (though not so sure about the marriage part — that is for another post. And I’m 99.9 percent certain there is no windfall in my future …).
In fact, making sure that women are financially solvent through every stage of life is critical if we will ever have gender equality — which is the underlying reason why I get up in the morning and write on this blog!
Unfortunately, we have so far to go when it comes to the wage gap, and the saving and investing gap.
Why single moms need long-term care insurance
Single moms, in fact, fare the worst when it comes to these metrics.
Not only do we have a disproportionate burden of caring for children, it is harder to build a career when you have children to care for solo, and so we earn less.
It is harder to build a career when you are focused on kids, and it is, of course, harder to save and invest for our own futures when you have those kids.
Single moms are also very likely to care for older parents and disabled loved ones — we are members of the sandwich generation, but on steroids!
One recent study by the Centers for Disease Control and Prevention of working caregivers found that nearly half arrive at work late or leave early to care for their loved one, 15 percent take a leave of absence or reduced hours, while others turn down promotions or leave work entirely.
If you'd like to know if your older relative qualifies for long-term care insurance, contact LTC Consumer for a quick quote.
There are yet other forces at play — like single mom guilt. An Allianz survey a few years ago found that the majority of Americans were making the big mistake of ransoming their retirements by over-saving for their children’s college.
Single moms commit this no-no far more than other families, Allianz found.
I suggest the reason is that we feel so guilty for the fact our families are not traditional that somehow we “owe” it to our kids to help them get through school without the burden of debt.
But guess what? That means that we are now a burden on our kids. FACT.
This guilt — paired with actual financial hardships of single motherhood — means that by our later years, there isn’t much in the bank.
I like to say there are loans for college, but there are no loans for retirement. Heck, there are loans for everything — Disney, school clothes, soccer teams, health insurance can all go on a credit card. But not retirement!
As a result, we become a burden on our children. We may already be caring for our elderly parents, and whether or not you want to admit it, that is a burden you wish you did not have. The U.S. Department of Health and Human Services reports that it costs on average $92,376 per year for long-term care in a nursing home.
Thankfully, in addition to prioritizing earning, saving and investing, there is something else important that single women can do to be independent and afford quality life in the event that we can’t care for ourselves: long-term care insurance.
You can buy long-term life insurance for yourself, and you can also buy it for a loved one.
What is long-term care insurance?
Long-term care insurance covers aid and treatment options in the event that you need care for the long-term.
Technically, this usually means one of two things:
- You need help with two out of six daily living activities of living (like bathing, dressing, using the bathroom, eating, and continence) or,
- You have a severe cognitive impairment, like dementia.
On average, the cost of a nursing home is $92,376 per year, according to the U.S. Department of Health and Human Services.
Home care is about half that — while nursing care can exceed $140,000 in some states.
9 Services covered by long-term care insurance:
Long-term care insurance covers care that is not usually covered by health insurance, including Medicare.
It can include many types of care, some in your home, and some in a facility, including assisted living and nursing homes.
Some of these services might be provided by highly skilled therapists and doctors, while others by home care assistants.
- Home health care
- Respite care
- Hospice care
- Personal care in your home
- Assisted living facilities
- Adult day care centers
- Nursing homes
- Memory care facilities
- In some cases, family members can be reimbursed as paid care providers
This is care that typically falls outside of your typical health insurance coverage, including Medicare, which only covers a very short nursing home stay.
For those living below the poverty level, Medicaid can pay for some of these services — but only if you are impoverished.
How does long-term care insurance work?
To help cover potential long-term care expenses, some people choose to buy long-term care insurance. You can buy long-term care insurance for yourself, or buy it for others.
Like other forms of insurance, long-term care insurance allows you to pay a set premium every month or year that helps protect you against an expensive extended healthcare needs.
To buy long-term care insurance, find a third-party broker that can help you shop different plans to find the right policy for you and your family.
LTC Consumer is a great place to start. Once you plug in your name and contact information, a licensed advisor will contact you at a time convenient for you, and educate you about the process and give you several quotes from top-rated companies.
Because LTC Consumer works with many insurers, they have access to many quotes and can offer unique discounts in some cases.
Who should buy long-term care insurance?
According to the American Association for Long-Term Insurance, the best age to buy long-term care insurance is mid-50s.
According to the trade association:
“You can lock in your good health, and today there are policies that allow you to buy some coverage now and add to it in future years.”
About 70 percent of Americans who reach age 65 will likely need some type of long-term care before they die, according to federal estimates — and women are far more likely to need this care than men since we live longer.
The average length of needing care is 1.5 years for men and 2.5 years for women.
57% of all women age 65+ will require long-term care services and 18% of women will require them for 5+ years!
For those unlucky 57% of women that need care the average length of care jumps to 4.4 years.
If you are low-income and believe you can qualify for Medicaid, long-term care insurance may not be for you.
Likewise, if you are high income or have a lot of assets you can liquidate to pay for care, this expense may not be worth it.
How much does long-term insurance cost?
Yearly premiums for long-term care insurance average $2,700, according to AARP— double that of a man of the same age, according to the American Association for Long-Term Care Insurance.
Women’s premiums are higher because women live longer, in general, and are more likely to require long-term care.
Similar to life insurance, your health plays a role in how much your long-term care insurance policy will cost.
Current health, and your health history play a big role — including whether you smoke, are a healthy weight, have an active lifestyle, and if you have a history of illness. The older you are when you apply usually means the higher the premium.
LTC Consumer offers this example from one of the largest LTC insurance companies in the United States.
These premiums are for a basic plan that would pay out $3,000\month and $100,000 of total benefits. Both the monthly benefits and total benefits grow at 3% compound each year to keep up with the inflation of the cost of care.
For a single woman age 50 = $1,677\year
For a single woman age 60 = $2,195\year
How do I get a long-term insurance quote?
Needless to say, these costs vary wildly by individual, location and your specific needs. LTC Consumer has great, licensed advisors who will help you understand this often confusing process and help you find the best policy for the best price. Plug in your info, and they will reach out to find a time that is best for you to answer your questions and get a quote.
LTC Consumer’s parent company, MasterCare America, Inc, has an A+ rating with the Better Business Bureau, which is important to me, and their site is full of positive, glowing reviews talking about the personal, honest service — which goes a long way with me.
FAQ about LTC insurance
Q: Is it true that “you pay for the insurance with your money but buy it with your health”
A: Many people wait too long to look into the coverage until they already have a chronic condition that prevents them from ever getting a policy. It doesn’t matter if you are Bill Gates — if he isn’t healthy enough to qualify he won’t be offered a policy.
Q: I am worried about outliving my savings, and that all my investments and assets will be taken away to pay for healthcare costs. Should I be?
A: We are living longer than ever— but more often with chronic illness, compared to years past when people passed away before they could get chronically ill.
Q: Does long-term care insurance only covers nursing home care? I prefer care at home.
The good news is that all policies sold today cover home care provided by a licensed home care provider. You can get skilled nursing care at home if you have the money to pay for it. At-home 24\7 skilled nurse care can cost $15,000 per month and is preferred by most people and most families. The good news is that all long-term care insurance covers at home skilled nurse care.
Related posts about aging as a single woman and single mom:
Emma Johnson is a veteran money journalist, noted blogger, bestselling author and an host of the award-winning podcast, Like a Mother with Emma Johnson. A former Associated Press Financial Wire reporter and MSN Money columnist, Emma has written for the New York Times, Wall Street Journal, Forbes, Glamour, Oprah.com, U.S. News, Parenting, USA Today and others. Her #1 bestseller, The Kickass Single Mom (Penguin), was named to the New York Post's ‘Must Read” list.
Emma regularly comments on issues of modern families, gender equality, divorce, sex and motherhood for outlets like CNN, Headline News, New York Times, Wall Street Journal, Fox & Friends, CNBC, NPR, TIME, MONEY, O, The Oprah Magazine and The Doctors. She was named Parents magazine’s “Best of the Web,” “Top 15 Personal Finance Podcasts” by U.S. News, and a “Most Eligible New Yorker” by New York Observer.