3 BIG Retirement Risks You Should NEVER Take (and Why)

Long-Term Care Costs

Another retirement risk that many do not take into consideration is the cost of long-term care. While a lot of people do not like to think about the time when you may end up needing something like long-term care, it is a reality of life that we have to face, especially if you have any health conditions going into retirement.

The sad truth is that because of these high costs, most retirees find themselves devastating their investment portfolios and savings for retirement since a lot of the long-term costs can end up averaging anywhere between 1.17% and 3.64%, depending on what type of care you need.

When you add the fact that by the time you may have to deal with these costs, they can end up doubling or tripling from the cost they are at now, we can easily see how expensive this can get.

Long-term care includes the likes of skilled nursing homes, home health care, and assisted living, along with prolonged hospice stays if you happen to need them.

Back in 2021, a survey showed that home health care averaged somewhere around $61,200, while semiprivate nursing home rooms went all the way around $127,500. A silver lining comes in the form of assisted living, which is the least expensive one, despite averaging around $54,000.

A good way in which you can prove your retirement savings for long-term care is to opt for long-term care insurance! This has been the solution that advisers and insurance agents have been recommending for years.

The only drawback can arise if you want some sort of hybrid policy (as in annuities and life insurance), which may not be compatible with the premiums you have on the policy. Despite this, there are a lot of policies on the market, and as long as you explore your options, you will be able to find one that will work well with your circumstances.

If you are worried about these retirement risks, you should also look into other problems that could arise if you choose to live with your adult children. You can read all about the pros and cons of this arrangement in this article here!