Should you buy?

Long-term-care insurance is a costly form of disability insurance, and you may not use it for 20, 30, or more years if at all. Your first step should be to decide whether your circumstances warrant taking on the risk and expense of long-term-care insurance.

Begin by assessing your personal finances and family situation. Unfortunately, those who need long-term-care insurance to protect their assets often can’t afford it, and those who can afford it don’t need it because they have the funds to pay for their own care. Below are some guidelines, but no easy answers.

To help you assess your financial situation, you might want to consult a fee-only financial planner. Fee-only planners charge by the hour and do not accept commissions, so their advice will not be influenced by how much they would earn by selling you a policy. Many will conduct a one-visit assessment for $500 to $1,000.

Skip a plan if: Your net worth is less than $200,000. Medicaid will pick up the bills after you exhaust your funds. Depending on the state, your spouse may be allowed to keep some assets and his or her own income up to a specified limit, and also to remain in the family home. OR Your assets exceed $1.5 million. You will be able to afford to pay for your own care. OR You can’t afford the premiums for the necessary coverage, or you don’t anticipate having enough money to cover sharp premium hikes that may take place during the years you own the policy.

Consider a plan if: By around age 55, you have a chronic medical condition that you and your doctor believe could eventually require nursing-home care or if you have a family history of a debilitating disease. AND Your assets are between $200,000 and $1.5 million, and you must protect them for a spouse or relatives. AND You have no willing or available family member to take care of you. Even with the support of community and professional home-care services, you’ll need a family caregiver. Because women live longer than men, they are more likely to need nursing-home care.