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A good long-term care policy helps you pay the cost of nursing home care, adult day care, assisted living arrangements, and home-based care. So, should you buy a long-term care policy? Here are some general factors to consider:

Are You Single or Are You Married?

Generally, married people are in greater need of an LTC policy since the cost of nursing home care can exhaust your savings and make it difficult for the spouse to maintain his or her standard of living. While most states will allow the non-institutionalized spouse to keep a home, a car, and some assets while the institutionalized spouse collects Medicaid, the drain may drastically change your lifestyle. If you're also concerned that your children will get your assets, you'll want to make sure you have adequate insurance (and good estate planning) to cover possible nursing home care costs.

On the other hand, if you're single, and you don't have to worry about children or other heirs or charitable organizations getting your money, you're probably better off without the insurance and paying the bills out of your savings.

How Old Are You?

A good time to buy an LTC policy is in your early 60s (60–65). If you're in your 50s, the cost of the insurance will be lower, but you'll most likely be paying it for a longer time. If you decide to wait until you're in your 70s, the policy can be quite costly and you also run the risk of not being insurable.

How Is Your Financial Situation?

If you have very little savings or income in retirement, there's no need to purchase an LTC policy. You'll end up spending more than you could afford, and Medicaid will most likely pay your nursing home bills. If you have cash and investments, other than your house, and these assets exceed the maximum resource amount per person allowed by Medicaid, an LTC policy is worth considering.

What is your family history related to diseases such as Alzheimer's, arthritis, stroke, etc.? If these or other debilitating diseases run in your family, you should strongly consider purchasing LTC insurance.

Review the following table to help you make your decisions:*

*These guidelines are general. The appropriateness of purchasing LTC insurance depends on the specific facts and circumstances of each individual.

**If you have an existing health problem that is likely to result in the need for long-term care, you will probably not be able to buy a policy due to medical underwriting standards.