Can I Self-Insure Against the Risk?

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Hypothetical Annual Premium of $3,935 1
Premium Saving at 4%
33% Tax Bracket 		Age Annual Cost of Care
5% Inflation
$3,935
52
$156,950
$7,975
53
$164,798
$12,124
54
$173,038
$16,384
55
$181,690
$20,758
56
$190,774
$25,249
57
$200,313
$29,861
58
$210,329
$34,596
59
$220,845
$39,458
60
$231,887
$44,450
61
$243,481
$49,576
62
$255,655
$54,840
63
$268,438
$60,245
64
$281,860
$65,795
65
$295,953
$71,493
66
$310,751
$77,344
67
$326,289
$83,352
68
$342,603
$89,521
69
$359,733
$95,855
70
$377,720
$102,359
71
$396,606
$109,037
72
$416,436
$115,894
73
$437,258
$122,935
74
$459,121
$130,165
75
$482,077
$137,588
76
$506,181
$145,210
77
$531,490
$153,037
78
$558,064
$161,073
79
$585,967
$169,325
80
$615,265

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 ($1,676,470.00) of exposure.

Every year in addition to the average 3 Year need will cost you an additional $615,265 per year.

1. Interest credited at the end of the year. Hypothetical premium based on $430/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