20 years ago when we looked…the rate was locked in for a very long time…like maybe until age 70? But then the prices did go up. I don’t believe that is the case now…but policies might vary. Perhaps others who have purchased more recently can comment.
Also, one policy we considered had premiums that actually ended after a certain number of years but coverage continued. I doubt those exist now, but others would have to comment.
Our LTC policy (employer group rates) was in place a few years before retirement, so by starting younger the premium is not too bad now… about $225/mo total for both of us. If rates stay same, we are likely to keep it, having bitten the bullet younger/healthier years. It has been giving us peace of mind to have it, particularly the at-home caregiver aspect.
The thing that does worry me though is when we feel it is needed that it might be difficult to meet the criteria (needing assistance on least 2 ADL / Activies of Daily Living), especially if Genworth gives pushback.
Investments have done well. So if we were making the decision now, probably we’d do self-funding gamble.
My husband got on a kick lately of thinking, hey, we should check out some salt water property nearby for a rental, to give us a project for retirement. We have a Delaware Statutory Trust that’s going full cycle at some point in the next few years, and could 1031 exchange it into a rental property. So we checked out some areas within a few hours drive on the Puget Sound, and as expected, they’re expensive.
Just for kicks, I thought, why not check out oceanfront property in California or Hawaii, something warmer? Crazy, insanely expensive, as in double digit million dollars. Even for some condos. Florida? Also crazy, not quite as bad, but with hurricanes and flooding, I don’t see putting money there.
It is really of note to me how much prices have gone up. Is it all the corporations, foreign buyers, people who have won the tech lotteries? How can prices possibly increased so much? I realize this is waterfront property, but the increase in just a few years is insane. If non-waterfront property prices are increasing at similar rates, no wonder people aren’t selling and moving. A friend of mine just bought a gorgeous retirement property on the ocean in Panama for 160K. Maybe we should look outside of the US.
That could make sense, especially if there are easy flights from your home airport. And then your online CC pals could live vicariously through your endeavor.
One fact I had forgotten to mention is some of this was exacerbated with kidney failure and dialysis - I will check with DD2 to see if he still has kidney issues and how that is affecting him. The psych adjustment might be in order if the kidney failure has been abated - but his body electrolytes and homeostasis could be off base causing more of the dementia issues. He is not ‘super active’ - I believe almost bedridden.
Thats all true, but if there are some worth buying, IMO it’s a good idea if affordable. Professional disability policies are also much less “robust” now, but still can be worthwhile.
Honestly, I don’t think there’s anything convenient overseas from Seattle. And Panama sure isn’t easy. But maybe if I lived in the south, it would be an easy one hop to somewhere in the Caribbean. But that’s probably crazy expensive, too! Still thinking about my area, maybe we could find a serious fixer on the sound.
Florida prices went up dramatically during Covid. We moved from our Florida Intra coastal condo to a Gulf-side condo in June of 2020. Had we waited 6 months longer we wouldn’t have felt comfortable doing that because prices had gone up that much more.
With remote work a possibility, many took advantage of relocating to Florida with its warmer climate, no state income taxes, and more open Covid policies. Home prices overall were considerably less than in New England. Cash buyers also drove up prices.
I do think prices will at least start to drop/stabilize after this past hurricane season. Insurance rates are very high now, mitigating much of the advantages of no state income tax.
I can see why prices in Florida went up over Covid. I can’t see putting money in that area now, with insurance prices and companies pulling out, just seems too dicey.
Those definitely factored into our decision to leave!
H and I have both been ineligible for a LTC policy for many years. There are more issues for some people that just the cost of LTC insurance. That’s one reason H was concerned about having enough for retirement even when our nest egg exceeded what I thought was sufficient. I haven’t shared any numbers here before, but will say that when we hit $4 million, not including the value of our home, I was ready for H to retire. H didn’t believe that was enough. I understand that part of what influenced H’s feelings was how much we spent on supplementing care for all of our parents.
I don’t know what posters here consider “really rich” and I do not think we’re in that category, although we’re thankful to be comfortable. While my parents died in their late 80s, H’s were much older. One grandmother lived to be >100. H insisted that we should have enough to last at least until he’s 100. The last set of scenarios run by our former (employer provided) FA gave H a 95% - 100% chance that our funds will outlast us. I later found out that the FA was unaware of a couple of smaller accounts that H “forgot” about.
It’s not easy to get out of the savings mindset and allow oneself to spend more freely after decades of frugality. Having lived through some serious financial setbacks over the decades may also contribute to H’s worries no matter how needless I consider his concerns.
I am definitely with you on this. I am not going to live the rest of my life in a way that will 100% guarantee a huge pile of money left for my two kids. I watched my parents and in-laws live what I would say is/was a boring retirement. No major travel or fun entertainment things like shows, ballgames etc. They all aged quickly in retirement due to lack of activity. My folks have passed away one at 71 and the other at 75. My MIL passed away at 74. I still have my FIL who is 79. I definitely want to do stuff rather than sit.
We will still have some funds to pass along to the kids.
The last 3 Xmas’s we have taken nice vacations and brought the kids. I would rather spend the money on that than ensuring that I will have a pile of assets when I am 95.
Regarding getting LTC companies to approve payment … yes, it’s difficult. But we were able to do it for both FIL & MIL, despite reluctance on the part of the insurers (one had Genworth & one had a different insurer). It was really hard in FIL’s case because his doctor was pretty useless when it came to helping us with documentation. FIL had very advanced Parkinson’s, but he was adamant about trying to do things himself - he’d tell the doctor he could dress himself, but he neglected to say “sometimes” & “if I have about four hours to spare.” MIL would not push for him, so H & his sister had to intervene. MIL’s was easier because she was in AL & they helped her get it approved. While it can be difficult to get approved, the key is to keep pushing.
All of the above! Although some are going bust… like OceanWide that bailed out of their Atlantis project on Oahu. 
Why this certainly can affect longevity, I don’t think you can blame deaths in their 70’s on this. Genetics plays a big role. FWIW, my mother is the most inactive person I can imagine. She lives alone, doesn’t drive, has no hobbies, no internet. She reads, does puzzles, and watches TV. She just turned 90. Her mother (my grandmother) made it to 96. All the aunts and uncles on that side made it to at least 80. They were all couch potato types. Inactivity didn’t kill them.
Prices around the Puget Sound skyrocketed with covid and remote work; e.g. Bremerton used to be “cheap” (unlike Bainbridge Island) because of the longer ferry ride into Seattle it was considered too far of a commute for most people. But once prospective Seattle home buyers (and their salaries) didn’t need to go into an office every day, they flocked to properties further afield.
There seem to be some properties around the Myrtle Beach area that might be affordable and income positive. One of my sisters owned an oceanfront condo in North Myrtle.
It’s not just oceanfront properties. In my midwestern state, prices for vacation homes on inland lakes have skyrocketed. People are paying a fortune to buy a standard cottage like those that have long been weekend getaways for families in our state … then knocking them down and building huge, expensive vacation homes. On top of that, the boats people need are getting more & more expensive. We can’t even go out in our boat on the weekends on the lake where our (small) cottage is located. The six figure tritoons and super fancy wake boats swamp our regular outboard boat … they even swamp us while we sit on the dock. It’s insane. Some of these owners are retired, so I guess they have very nice nest eggs.
Your post sort of reflects how I feel/what I’ve observed. For example, I think we are dong “fine” in retirement, and have a fair amount of money saved. BUT, I have a cousin in CA who purchased his house for probably less than $200K, and now it’s worth well over a million. His mom died and he inherited her home, also worth well over a million, and he doesn’t have to pay capital gains for that inheritance. Plus I’m guessing he makes LOTS of money (he is a Silicon Valley guy). He said as much to an aunt, not bragging, just letting her know she didn’t need to worry about helping him. I have another California relative that didn’t go to college, but still invested in property and landed in a career great for him, making tons of money.
It’s like we have “normal people,” that have worked fine jobs and saved for retirement and all is well, and then we have this “uber rich by happenstance or luck of location/particular investment” kind of people, that throw off the curve if you will.
I am satisfied with my life and recognize we are lucky to be where we are. BUT… seeing the astronomical home prices and growth of investments for some people in some places or who invested well/in the right stocks, mostly by luck, make me worry that maybe we won’t have enough/our investments won’t keep up.
Regarding the LTC discussion: We bought about 15 years ago. At the time the company (Genworth) was rated A or higher. Broker shared that the premiums for this policy had historically NEVER risen, but with the caveat that they could. Well, rates skyrocketed once we turned 60. (Claiming of course, that it was not due to our age, but the timing happened to coincide). Our premiums then doubled over the next few years. They are now also only rated C++ with continuous threats of potential huge increases going forward.
We’re concerned that not only they will fight a future claim, but will they even be in business at all?
So we question every year if we should continue. Typically they send several options: substantially cut coverage , severely reduce inflation factor, or drop entirely (and return our premiums paid to date). Fortunately, our policy includes a 5% per year automatic increase in coverage (4 year max). We were very lucky to have that. As a result, we now typically reduce the benefit to maintain the existing premium. Our coverage has not kept up with LTC cost increases, but the inflation factor has protected us to some degree. I’m confident that is no longer a choice. Whenever we think it is time to stop, others remind us that this coverage is no longer available, so we continue - and hope they stay in business!