Long Term Care Insurance vs. Short Term Care InsuranceSome people may wonder why it’s worth spending the money every month for long term care insurance. While it can be easy to push off many things until they are necessary and decide to deal with problems when they arrive, but the reality of a permanent disability is not an easy problem to solve. One in five Americans will become disabled and 30% of workers will need to use some sort of disability before they retire. Disability insurance replaces your paycheck when you become disabled in some way that prevents you from working. Many people have insurance that will cover surgery and medication and other medical expenses in case of an illness or injury, but most of these people are not prepared to lose their paycheck during the time of illness or injury and recovery. Without some sort of disability insurance, there is no incoming money to pay the rent or mortgage, the car payments, the electricity bill, and to be used to purchase food. Short term disability is offered by most employers, but time spans can be short and it may not equal normal wages. A couple of weeks of disability may not be enough, but it may be all that your employer offers. Even if your coverage pays out about the same amount as your normal income, this could drop to as low as 60% after a few weeks. This can add a lot of stress in an already stressful time. That extra 40% of your normal paycheck might be needed to pay for medical bills that are not covered by insurance. Short term disability through your employer is also subject to taxes and details vary from plan to plan. Make sure you know how much (or how little) your employer will cover before you look for a long term care insurance policy. You may need more coverage than you were expecting. But short term disability insurance isn’t always enough, and many times there is no way to tell how long you will be unable to work. As advances are made in the medical field, more health problems are becoming disabling instead of deadly which can make long term insurance necessary. Policies can be made for any number of years, some common ones being 5 and 10. However, insurance covering until age 65 is the most thorough and probably the best choice for many people. There are many other particulars for long term care insurance policies, including non-cancelable insurance and cost of living adjustment (COLA) to make sure that your payout is not diminished to insignificance by inflation. However, there is more to long term care insurance than just coverage for disabilities. This insurance also covers nursing homes and assisted living facilities as well as home care. Care for senior citizens is becoming increasingly expensive. Insurance that covers this kind of care can be a big help in making this care more affordable. There are many details involving this as well, including defining when someone is unable to live independently and how long the payments will come, so detailed research and careful thought must be put into this choice. Many people may find it easy to put this decision off and decide to think about preparing for a nursing home when they hit retirement, but this kind of decision requires preparation. Also, with the large number of people who will face a disability in their lifetime it is important for people to think about this kind of care early in life because they may become disabled to the point that they need assistance all the time and they can no longer live by themselves. Shelling out monthly for disability insurance can seem like wasted money, but it is necessary. In the middle of a crisis like a disability that prevents you from working is not the time to find a solution. Planning ahead with both short term and long term care insurance will guarantee that all the necessary bills will be paid for. Short term disability is important and will be used by about 30% of workers. However, people cannot remain ignorant to the importance of long term care insurance both to protect against disability and to make sure that they can afford help when they are no longer able to live by themselves.
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