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As a Social Security cut looms, should seniors buy long-term care insurance now?

With the prospect of a social security reduction high, seniors should consider the benefits of a long-term care insurance policy now. Lane V. Erickson/Getty Images

Social Security is running low, just not as quickly as initially expected. That was the big news for seniors this week after the Social Security Board of Trustees released its annual report, projecting that it may not need to cut benefits until 2035, or one year later than originally predicted. Still, if that cut does eventually come to fruition, it will be a painful one at 17% less in monthly payments. That's a substantial cut for the 70 million Americans currently relying on their Social Security benefits.

The news, while seemingly far off, should lead many American seniors to take a closer look at their financial circumstances. Do they have enough money to offset a potential cost? And how will they be able to pay for the rising cost of long-term care as they age? Fortunately, there is one trusted and reliable form of insurance that may be worth purchasing now: long-term care insurance.

This unique type of protection can help cover the costs of nursing homes, assisted living facilities and in-home caretakers. And with the prospect of reduced Social Security benefits in mind, many seniors may want to act now. Below, we'll break down three reasons why.

Start by exploring your long-term care insurance options online here.

Should seniors buy long-term care insurance ahead of a Social Security cut?

Here are three compelling reasons why seniors may want to purchase a long-term care insurance plan now before any cut to Social Security goes into effect:

The costs will rise

Like most insurance policies, the longer you wait the more likely the price is to increase. And, long-term care insurance is no exception. While you can potentially secure a policy up until the age of 85, the sooner you act the less you'll likely pay. That's why many experts suggest getting started before the age of 65, although you could theoretically purchase a plan as soon as your 40s or 50s

Just don't wait around and expect to secure cost-effective coverage later in life, because it's unlikely to be offered without a hefty premium attached. And that will be particularly problematic if your Social Security benefits have been cut by that point.

See how much a long-term care insurance policy would cost you now.

The need for care will increase

As you age, the need for long-term care will increase. But waiting for that need to arise could align with a cut to your Social Security benefits, combining to form a perfect storm of needed care and a limited budget. So, if you already know that you will need the care a long-term care insurance policy can help pay for, it makes sense to act now. "Someone turning age 65 today has almost a 70% chance of needing some type of long-term care services and supports in their remaining years," the Department of Health & Human Services notes online

Your budget may already be strained

While this inflationary cycle may be at its end, the damage to your finances may have already occurred. Thanks to the highest inflation rate in decades (which has since cooled) and the highest interest rates since 2001 (which haven't cooled), millions of seniors have seen their budgets tightened thanks to a higher cost of living. 

So if your budget is strained now, who knows what it can look like in a few years? The most recent Social Security cost of living adjustment (COLA) was significantly less than it was the year before (3.2% for 2024 versus 8.7% for 2023), as well. Against this backdrop, then, it could be advantageous to secure a long-term care insurance policy now, while premiums are still manageable. 

Learn more about your long-term care insurance options here.

The bottom line

In the face of a prospective cut to Social Security benefits, seniors should prepare for the cost of their long-term care now. Fortunately, a long-term care insurance policy could help. But it pays to be proactive. If your budget is already strained thanks to today's inflationary pressures, it may pay to get some financial protection lined up in advance of a need. And, with the prospect of rising premiums and an increased need for care, now may be the time to secure a plan. By doing so, you'll have a way to adequately pay for your long-term care needs, regardless of any adjustments to your Social Security benefits. 

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