An excerpt from a Fidelity online newsletter.
"...The need for long-term care is based on a person's cognitive abilities and/or a decreased ability to perform a specific number of what are called activities of daily living, such as: dressing, bathing, eating, toileting, continence, and transferring (getting in and out of bed, the bathtub, chairs). When it becomes too difficult to perform two or more of these functions on your own, long-term care insurance pays benefits that help pay for the assistance needed.
How much do you need?
A good starting point is to look at long-term care costs in your area, as they vary widely. For example, average nursing home costs are $36,135 in Shreveport, La., but $113,880 in New York City, with a current national average of $70,000, according to CareScout, a Massachusetts company that specializes in elder care provider databases.
For example, to pay the current national average cost of nursing home care, you'd need about $5,800 a month in benefits. And the cost of nursing home care is almost sure to rise over time. Many policies provide benefits that escalate to account for inflation, which may be worth considering, since it is possible you may not use long-term care insurance right away, if at all.
"Think of a policy as a pool of benefits," explains Miller. "For example, if you have a policy that pays a maximum benefit of $5,500 a month for five years, you have a total benefit amount of $330,000—so if you spend less, it will last longer. Spend more and it will run out sooner...""
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