You can use your savings or other personal resources to pay for long-term care. This is also called “self-insuring”. Some personal resources may include money in a checking or savings account, stocks, bonds, investments, life insurance policies, pensions, and income. Your family may also want to give you money towards your long-term care needs. If you choose this option, you should plan ahead before you need long-term care. Make sure you think about all your future health care needs and costs.
Long-term care is very expensive. This option may only be practical for people with above average resources.
Listed below are some opportunities and requirements/limits for self-insurance/personal savings plan:
| Self-Insurance/Personal Savings Plan Opportunities: | Self-Insurance/Personal Savings Plan Requirements/Limits: |
|---|---|
| If you don’t need long-term care, you will still have your money that you set aside for long-term care needs. This money is yours. You might be able to leave something to your heirs (family or friends). | The money you save (set aside) should only be used for your long-term care needs. You might not save enough money to pay for all of your long-term care costs. To be self-insured, you will have to start at a young age, save a lot of money, and stick with this plan for a long period of time. |
| If you set aside enough money for your long-term care needs, you can choose where and how you receive your care. | There may be rules about when you can use your investments for paying long-term care. In some cases, you may have to pay a penalty for withdrawing the money. |
| You don’t have to worry about qualifying for a long-term care insurance policy. | If you need long-term care and use your money, you might not be able to leave anything to your heirs (family or friends). |