Long-Term Care Planning: What Are Your Options?

Long-Term Care Planning: What Are Your Options?

How to approach care planning with clarity and confidence

By: Landon Evans, CLTC®

Planning for long-term care is one of the more emotionally charged aspects of financial planning. It’s easy to avoid, and even easier to underestimate—until a loved one needs care or a health event forces the conversation. But for those who want to protect their family, preserve their assets, and maintain autonomy, long-term care (LTC) planning is a critical piece of the puzzle.

Roughly 70% of Americans over age 65 will need some form of long-term care during their lifetime, according to the U.S. Department of Health and Human Services. And while some care needs may be short-term, many are not. A private room in a nursing facility now averages over $100,000 per year, and even in-home care can exceed $60,000 annually for full-time support. These aren’t just healthcare costs—they’re lifestyle-altering financial events.

So how do you plan for something that may or may not happen, with costs that are difficult to predict? There are four primary strategies for funding long-term care: self-funding from retirement assets, purchasing traditional LTC insurance, using hybrid life insurance with an LTC rider, or relying on family. Each path carries trade-offs, and there is no one-size-fits-all solution. But understanding the framework is a powerful first step.

#1 - Self-Funding from Retirement Assets

For high-net-worth individuals, the initial instinct is often to self-insure—to rely on existing savings, investment accounts, or retirement income to cover future care costs. This can work well in certain scenarios, especially when resources are abundant and the potential care need is relatively brief. However, the challenge lies in unpredictability.

Few retirees plan on needing several hundred thousand dollars set aside for care late in life. Even fewer want to earmark those funds permanently, just in case. For married couples, self-funding also raises important questions: what happens to the surviving spouse’s financial security if significant assets are depleted for care? Could market volatility or sequence of returns risk exacerbate the situation?

A financial advisor with care planning experience can help quantify the impact. Through retirement income modeling and stress testing, it’s possible to gauge whether your portfolio could sustain a major care event without derailing the rest of your plan.

#2 - Traditional Long-Term Care Insurance

Traditional long-term care insurance offers dedicated coverage for care at home, in assisted living, or in a facility—helping preserve retirement assets and reduce financial strain on loved ones.

The biggest hurdle is often eligibility. These policies require medical underwriting, and seemingly routine health issues like back pain, sleep apnea, or a recent surgery can lead to denial. Unfortunately, many people delay exploring coverage until after health changes occur, by which point the window of opportunity may have closed.

For those in good health, applying earlier increases the likelihood of approval and allows for access to policies with guaranteed premiums and stable benefits. It’s one of the few planning areas where timing can directly impact whether the strategy is available at all.

For that reason, long-term care insurance is often best considered not when care feels imminent—but while it still feels remote.

#3 - Hybrid Life Insurance with an LTC Rider

For those who are hesitant to buy standalone insurance “just in case,” hybrid life insurance policies with long-term care riders offer a compelling alternative. These policies combine life insurance with the ability to accelerate the death benefit—or access an additional care pool—if you require long-term care.

From a planning perspective, this structure can feel more efficient. If care is never needed, your heirs still receive a tax-free benefit. If care is needed, the policy provides flexible access to funds without disrupting other investments. Many hybrid policies also offer guaranteed premiums, avoiding the risk of future rate increases.

Of course, the benefit amount on these hybrid policies is tied to the size of the life insurance policy, and they also carry medical underwriting (though it is based on Mortality as opposed to Morbidity with traditional policies, which creates different options for different situations). For individuals who value predictability and don’t want to "use it or lose it," hybrid insurance can be a powerful tool—especially when integrated into estate and legacy planning.

#4 - Relying on Family

This last option is rarely planned, but often assumed. In the absence of formal care arrangements, families frequently step in to fill the gap. Sometimes it’s a spouse, sometimes a child. In many cases, caregiving becomes a full-time job—with little preparation and even less support.

While relying on family may seem cost-effective, the hidden costs are significant. Caregiving duties can lead to lost income, physical exhaustion, emotional burnout, and strained relationships. And not all families are geographically or emotionally equipped to provide this level of care.

It’s worth noting that even when other funding strategies are in place, families still play a role in managing care. But having a plan—rather than defaulting to this route—can make the difference between an empowering support system and an overwhelming burden.

How to Decide What’s Right for You

Few events have the potential to disrupt both a retirement plan and a family dynamic the way a long-term care need can. The emotional toll on loved ones, the unexpected expenses, and the decisions that have to be made under pressure—it can all feel overwhelming without a clear plan in place.

That’s why long-term care planning isn’t just about choosing a funding method. It’s about protecting your future independence, preserving family relationships, and ensuring that financial goals stay on track—even in the face of unexpected challenges.

It’s also why I chose to obtain the Certified in Long-Term Care (CLTC) designation. These conversations deserve more than surface-level guidance. They require careful analysis, practical experience, and a deep understanding of how care fits into the broader financial picture.

Whether that means modeling how your retirement assets would hold up to a multi-year care event, comparing the structure of different insurance strategies, or helping weigh the impact on your family—long-term care planning is best done proactively, while your options are still open.

And it starts with a conversation.