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For some individuals, long-term care in the grand scheme of a full retirement plan can often end up in the “good-to-have” category, versus “need-to-have”. However, the reality is about 70 percent of retirees now 65 or older will develop some form of long-term care need before they pass away. Of that 70 percent, only 48 percent will be able to pay for their care.

According to recent reports, the median cost for a private room in a nursing home sits at over $105,000 per year (depending on geographic location), and some project these prices will double in the next 20 years. For the purpose of planning, statistics here show the average likelihood you might need certain types of long-term care as you age. And, if you do end up needing any of these forms of care for a substantial period of time in the future, there are four main ways to cover the cost:

📌Long-term care insurance – To combat the frustration of the “use it or lose it” mentality when it comes to policies, the industry created a hybrid long-term care insurance policy, which combines long-term care coverage with life insurance benefits

📌Veteran’s benefits – For those who qualify, the Department of Veteran’s Affairs (VA) offers long-term care programs

📌Self-funding – If you haven’t made plans to cover the cost of long-term care ahead of time and end up needing it, all available assets will be up for question; and whether or not to self-fund will ultimately depend on the degree of care you might need, source of care and its duration

📌Medicare vs. Medicaid – Medicare does not cover long-term care expenses, so for Medicare users who cannot cover costs, Medicaid steps in as the likely solution

Plan accordingly: Long-term care expenses may be the only major risk to your financial future, and more than one solution exists to solve for them. You cannot simply tune out the possibility, given the high likelihood of occurrence.