Most people agree that it is extremely important to save for retirement. During our retirement years, we will have the same desire for a good quality of life that we have at our current age. It is therefore essential to start investing for retirement as early as possible.
However, as we start investing for retirement, we also need to remove the biggest threat to actually being able to use those retirement funds as we hope. That threat is the enormous expense of long-term care.
According to the United States Department of Health and Human Services, someone at age 65 today has almost a 70% chance of needing some form of long-term care services in their later years. The average need for such services is three years (which means that half of the population will probably need it less than three years and half of the population will need it longer than three years), 20% will need it longer than five years, and, according to the Mayo Clinic, if one develops Alzheimer’s or has had a stroke, one will possibly need it ten years or longer.
The average cost for a semiprivate room in a nursing home in the Baltimore area in 2026 is over $150,000 a year, and the cost for 24/7 care in one’s home is over $ 315,000 a year. Therefore, as one plans for retirement, it is also important to consider the possible cost for long term care in one’s later years, its effect on one’s retirement savings, and thus plan accordingly. Each person’s situation is different and the plan is best individualized.