Planning ahead for long term care and how to fund it can seem daunting. The average American underestimates in-home care costs by nearly 50 percent, according to the Genworth Financial 2016 Cost of Care Study. The findings indicate many adults risk being unprepared for their future needs.
The cost of receiving care has continued to increase significantly each year across all care options, except adult day care. The most expensive long term care option is a private nursing home. Since 2011, the median annual cost for a room has grown by nearly 19 percent to over $92,000.
Americans are also paying more for homemakers or home health aides. Although such in-home services are the most popular care option, nearly one-third of individuals have serious misconceptions about the expenses. Many incorrectly believe such services cost under $417 per month. In reality, the national and state-by-state median rate averages above $3,800 per month.
The annual caregiving survey analyzes state and national care costs. It aims to help Americans become aware of various long term care options and their potential costs. Many people do not understand long term care expenses until they experience them.
“At least 70 percent of Americans over age 65 will need some form of long term care services and support during their lives,” said Genworth President and CEO Tom McInerney. “[There is a] huge disparity between what consumers think costs are and what they actually are.”
As a result, it is important for individuals to have an honest conversation with family members about what type of care they would like to receive when the need arises. Learning about the costs will help Americans plan ahead for future expenses before it is too late.