Can I Self-Insure Against the Risk?

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Hypothetical Annual Premium of $2,928 1
Premium Saving at 4%
33% Tax Bracket 		Age Annual Cost of Care
5% Inflation
$2,928
52
$116,800
$5,934
53
$122,640
$9,021
54
$128,772
$12,191
55
$135,211
$15,446
56
$141,972
$18,788
57
$149,071
$22,220
58
$156,525
$25,743
59
$164,351
$29,361
60
$172,569
$33,076
61
$181,197
$36,890
62
$190,257
$40,807
63
$199,770
$44,829
64
$209,758
$48,958
65
$220,246
$53,198
66
$231,258
$57,552
67
$242,821
$62,022
68
$254,962
$66,612
69
$267,710
$71,325
70
$281,096
$76,165
71
$295,151
$81,134
72
$309,909
$86,236
73
$325,404
$91,475
74
$341,674
$96,855
75
$358,758
$102,379
76
$376,696
$108,051
77
$395,531
$113,875
78
$415,308
$119,855
79
$436,073
$125,995
80
$457,877

After 28 years of saving, you  have accumulated approximately enough money to pay for only 3.3 months of care.

If you were faced with the average 3 Year Long-Term Care need2, even under the optimal saving conditions shown above, you would have ($1,247,636.00) of exposure.

Every year in addition to the average 3 Year need will cost you an additional $457,877 per year.

1. Interest credited at the end of the year. Hypothetical premium based on $320/Day, 100% Home Health, Three Year Benefit Period, 3% Compound Inflation Rider and 90 Day Elimination Period with Spousal & Preferred Discounts. Policies vary, consult your agent about specific plan design and premiums for your individual situation.

2. National Clearinghouse for Long-Term Care Information, "How Much Care Will You Need?" June 2012