Nationwide: Two-Thirds Of Adults Worry They Will Become A Burden

Nearly half of Americans who took part in the 10th Annual Nationwide Retirement Institute Long-term Care Survey said that they are more afraid of falling than of getting cancer.

And 80% agreed that it is important for them to live in a single-floor home when they age. But according to the survey, 68% of non-retirees said that their current home has stairs.

“Many adults are concerned about navigating their home’s stairs and step-up entries as they age,” noted Holly Snyder, president, Nationwide Life. “However, there are long-term care solutions with cash indemnity style benefits that allow policy holders to use the money to pay for more than just typical assisted living expenses. You can use this coverage to pay a relative to help with your long-term care and to install lifts, elevators and safety railings so you can stay in your home."

Families Expected To Help

Most adults (70%) would like to have the option of relying on their families for long-term care (LTC) if they need it, the survey said. In fact, half (50%) feel it is the responsibility of their family to care for them if they need long-term care.

This sentiment is particularly high for Millennials (69%) and declines with age (52% for Gen Xers and 33% for Boomers+). Millennials and Gen Xers expect their parents to live with them when they get older (61% and 49%), and they expect to live with their adult children when they get older (46% and 36% vs. just one in four Boomers).

But two-thirds of adults (66%) are worried they will become a burden to their family as they get older. In fact, seven in 10 adults (70%) would not expect a family member to provide long-term care if they were not able to compensate them. But as Snyder pointed out earlier, LTC solutions with cash indemnity style benefits will help pay for some of this care.

LTC Coverage Misunderstood

The survey also noted that quite a few Americans misunderstand LTC coverage. For example, 25% of the respondents who self-reported said that they currently own long-term care insurance (LTCI) for themselves. But according to industry data, only 15% of Americans have purchased LTCI and most of those are older consumers.

However, it is not a good idea to wait until you are 65 to think about LTC, Snyder pointed out. Although wealthy consumers can self-insure, it makes more sense to leverage LTC products if they qualify, she added.

Among the different demographic groups surveyed, millennials (39%) are more likely than Gen Xers (26%) and boomers+ (19%) to claim they currently own LTCI for themselves. Most of them said that they bought the insurance at work, which gives away the misconception--too many adults confuse long-term disability insurance with LTCI, the survey said.

Having The LTC Conversation

According to the survey, nearly half of adults across all age groups have not discussed LTC costs with anyone, and fewer than one in 10 adults (8%) said that they’ve discussed long-term planning with their financial professional.

The good news is that more than one-third (36%) plan to discuss LTC costs with a financial professional in the future, in particular, younger adults (41% millennials and 46% Gen Xers, vs. 24% boomers+).

As financial professionals meet with their clients, what can they do to persuade them to buy LTCI? It all goes back to education, Snyder said. According to LIMRA, year-to-date total workplace life insurance premium increased 7% to $2.9 billion. In the first nine months of 2021, new permanent life insurance premium increased 13%, representing 14% of the workplace life insurance sold, and term sales grew 6% year to date.

This growth in the sales of life insurance and other financial products has created a good opportunity for a discussion of LTC with clients, Snyder pointed out. “Help your clients understand long-term care insurance and talk about it as the foundational product they need in any financial plan,” she added.

Snyder said that it is difficult to talk about LTC or LTCI to younger consumers. So, early 40s might be a good age to start the conversation. “Educate them and let them know that if they buy early, they will save more money in the long run,” she said.

The 10th Annual Nationwide Retirement Institute Long-term Care Survey was conducted among 1,812 U.S. adults aged 24 or over and 706 caregivers. It was conducted online by The Harris Poll in October 2021.

Ayo Mseka has more than 30 years of experience reporting on the financial-services industry. She formerly served as Editor-In-Chief of NAIFA’s Advisor Today magazine. Contact her at [email protected]