Don't Let Poor Health Keep You From Protecting Your Assets

It's rare, but occasionally one spouse cannot qualify for long term care insurance because of poor health, such as hypertension, Alzheimer's, arthritis, diabetes, or frailty. Does this mean that the healthy spouse should forgo the coverage as well?

As you get older, the chances of needing long term care increases. Forty-three percent of individual's age 65 and older will spend time in a nursing home.

And once they reach age 75, the likelihood rises to 60 percent. Suppose you are healthy and your spouse is not. As long as you can maintain your good health, you will be able to care for him or her. But what will happen if you need care?

Both of you could end up in a nursing home and may even be split up.

A long term care insurance policy could pay for the care that you need and also provide for a homemaker to help with your spouse. To finance this, you could possibly double your policy's daily benefit above the average per day cost in your area. The surplus income would then be available to help offset your spouse's care giving expenses while you recover.

Another idea is a life income annuity that could pay nursing home expenses for your spouse when long term care insurance is not available. You could invest a lump sum with an annuity company that would pay your spouse a set amount for his or her lifetime. Generally, normal life expectancies determine annuity payouts. This means that the longer the life expectancy, the small the payout.

For someone who is ill, however, his or her life expectancy may not be normal. To accommodate these special situations, some companies offer medically underwritten annuities that factor the annuitant's illness into the life expectancy calculations and may provide higher than normal payouts. The payout numbers can help determine how much you would need to invest cover your spouse's long term care expenses.

There are strategies available when you cannot qualify for long term care coverage and an experienced retirement advisor or long term care specialist should be consulted.