Most people understand the importance of saving for retirement, maintaining appropriate insurance, and creating an estate plan. Yet one of the largest potential expenses in retirement is often overlooked: long-term care.
Part of the challenge is that long-term care is surrounded by misconceptions. Some people assume Medicare will pay for it. Others believe long-term care means moving into a nursing home or that their spouse and children will be able to provide whatever assistance they need.
These assumptions are understandable, but they can leave families unprepared when care becomes necessary.
At Cypress Wealth Services, we believe long-term care planning should begin with education. Understanding what long-term care involves, how it may be funded, and how it could affect your family can help you make more informed decisions while you still have meaningful choices.
Let's explore seven common long-term care myths and the planning considerations behind them.
Myth #1: Medicare Will Pay for My Long-Term Care
Myth: Medicare covers most long-term care expenses once you turn 65.
Reality: Medicare generally does not cover ongoing custodial long-term care, which is the assistance many people need as they age.
Medicare may cover qualifying short-term skilled nursing care, rehabilitation, or certain home health services when specific requirements are met. However, it generally does not pay for ongoing assistance with everyday activities such as bathing, dressing, eating, or using the bathroom. Medicare
This distinction is important because many people associate long-term care with medical treatment. In reality, much of it involves personal assistance rather than skilled medical services.
Someone living with dementia, for example, may need supervision and help with daily activities for an extended period without requiring continuous skilled nursing care.
For financial planning purposes, Medicare should not be treated as a comprehensive solution for long-term care expenses.
Myth #2: Long-Term Care Means Moving Into a Nursing Home
Myth: If I need long-term care, I will eventually have to move into a nursing home.
Reality: Long-term care can be provided in several settings, including your own home.
Home care
Assistance with bathing, dressing, meals, mobility, household tasks, and other everyday activities, depending on the services arranged.
Community-based care
Adult day programs and other services that can provide support while allowing someone to continue living at home.
Residential care
Assisted living, memory care, and nursing facilities that provide different levels of assistance and supervision.
Medicare identifies home, community, assisted living, and nursing facilities as potential settings for long-term care. Medicare
For many families, the goal is to preserve independence and maintain familiar surroundings for as long as it is practical and safe.
Planning ahead allows you to explore your preferences, understand the resources available in your community, and consider how different care arrangements might affect your finances.
The question isn't simply whether you could afford a nursing home. It's where you would prefer to receive care and what resources might help make that possible.
Myth #3: My Spouse or Children Will Take Care of Me
Myth: My family will provide whatever care I need, so I don't need a formal plan.
Reality: Family members can play an important role in caregiving, but relying entirely on them may create challenges that deserve consideration.
For couples, the assumption that one spouse will care for the other can seem natural. After all, supporting each other is part of marriage.
But what happens if both spouses experience health challenges? What if one person needs significant physical assistance that the other can no longer safely provide?
Adult children may also want to help, but they may be balancing careers, raising their own families, or living in another state.
The Administration for Community Living recognizes the substantial role family caregivers play and the importance of training, support, and opportunities for respite. ACL
A thoughtful long-term care plan considers not only the person who may need assistance but also the people who may be providing it.
Having conversations with family members about preferences, responsibilities, professional care options, and financial resources can help establish more realistic expectations.
Myth #4: I'm Healthy, So I Probably Won't Need Long-Term Care
Myth: If I stay active and take care of myself, long-term care probably won't be necessary.
Reality: Good health is valuable, but it cannot eliminate the possibility of needing assistance later in life.
Long-term care needs can arise from many circumstances, including chronic illness, cognitive decline, mobility limitations, injuries, and other changes associated with aging.
The Administration for Community Living notes that most people turning 65 can expect to use some form of long-term care during their remaining lives. That does not mean everyone will require extensive paid care or spend years in a facility. The amount, duration, and type of assistance vary considerably. (ACL)
The uncertainty is precisely why planning matters.
Rather than assuming you will or won't need care, consider how your retirement plan would respond if assistance became necessary.
For some families, that may mean maintaining sufficient assets to pay for care. Others may explore insurance or a combination of financial and family resources.
Myth #5: Long-Term Care Insurance Is the Only Way to Prepare
Myth: If I don't purchase long-term care insurance, I don't have a long-term care plan.
Reality: Insurance is one potential funding tool, but long-term care planning is much broader.
Depending on your financial circumstances, potential approaches may include using personal assets, purchasing traditional long-term care insurance, evaluating certain life insurance policies with long-term care benefits, or combining several resources.
Medicaid may also cover qualifying long-term care services for eligible individuals, although income, asset, and other eligibility requirements vary by state. Medicare
Each approach involves tradeoffs.
Insurance may help transfer certain financial risks but can involve substantial premiums, underwriting requirements, benefit limits, waiting periods, exclusions, and other policy restrictions. Self-funding provides flexibility but exposes personal assets to potentially significant care expenses.
There is no single strategy that is appropriate for every household.
The important distinction is that purchasing a policy and creating a care plan are not the same thing. A complete plan should also consider where you would prefer to receive care, who would coordinate it, and how your family would access the necessary resources.
Myth #6: I Have Enough Money to Pay for Care, So I Don't Need to Plan
Myth: If I have substantial retirement savings, I can simply pay for care if I ever need it.
Reality: Having the financial resources to pay for care is an advantage, but it doesn't eliminate the need to understand how a care event could affect your broader retirement plan.
Imagine a couple who has accumulated significant retirement assets and expects those assets to support their lifestyle for the next 30 years.
If one spouse requires several years of paid care, the household may face substantial additional expenses while continuing to fund the healthy spouse's normal lifestyle.
The financial question becomes more complicated than whether the couple can afford the monthly care bill.
How would those withdrawals affect future retirement income? Would investments need to be sold during an unfavorable market? Could the expenses reduce the assets available to the surviving spouse? How might taxes affect the cost of accessing retirement funds?
For families with substantial wealth, long-term care planning may be less about whether they can afford care and more about determining how they want to fund it without unnecessarily disrupting other financial priorities.
Myth #7: Long-Term Care Planning Can Wait Until I'm Older
Myth: I'll think about long-term care when I'm retired or when my health begins to change.
Reality: Waiting can limit your options and make important decisions more difficult.
If insurance is part of your strategy, age and health can affect eligibility, coverage availability, and premiums. A policy that is available today may not be available on the same terms later.
Even if you have no intention of purchasing insurance, planning ahead provides an opportunity to discuss care preferences, identify potential caregivers, review legal documents, and understand the financial implications.
The Administration for Community Living encourages individuals to begin considering long-term care needs well before care becomes necessary. ACL
For many families, the conversation becomes particularly relevant during their 50s and early 60s, when retirement planning is taking shape and there may still be time to evaluate a range of funding approaches.
There is no universal age at which everyone should make the same decisions. The important point is to begin the conversation while you have the time and flexibility to explore your options.
What Should a Long-Term Care Plan Actually Include?
Once you look beyond the myths, long-term care planning becomes a practical conversation about personal preferences, financial resources, and family responsibilities.
A useful plan addresses four interconnected areas: the type and location of care you would prefer, how potential expenses might be funded, who would coordinate care and make decisions if you couldn't, and how a care event could affect your spouse or other family members.
Legal preparation also matters. Appropriate powers of attorney, advance healthcare directives, and accessible financial records can help the people you trust carry out your wishes. These documents should be developed with qualified legal professionals and reviewed as circumstances change.
At Cypress Wealth Services, we believe the financial component should be incorporated into your overall retirement plan rather than evaluated in isolation. Potential care expenses can affect investment withdrawals, liquidity, taxes, retirement income, and the resources available to a surviving spouse.
Frequently Asked Questions
Does Medicare pay for long-term care?
Medicare generally does not pay for ongoing custodial long-term care. It may cover qualifying short-term skilled nursing or certain home health services when eligibility requirements are met. Medicare
Can I receive long-term care at home?
Yes. Depending on your needs and available resources, long-term care can include personal assistance and other services provided in your home. Home care may be appropriate for some individuals, while others eventually require more intensive supervision or facility-based care.
Is long-term care insurance necessary if I have substantial assets?
Not necessarily. Some households may choose to fund potential care expenses using personal assets, while others may consider insurance to help manage certain financial risks. The decision depends on your financial situation, health, preferences, coverage options, and the potential impact of care expenses on your broader plan.
When should I start planning for long-term care?
Ideally, before you need assistance. Early planning can provide more time to evaluate funding options, discuss preferences with family members, and organize the documents and resources that may be needed later.
Key Takeaway
The most common long-term care myths often share one underlying assumption: that care will either be covered by someone else or can be figured out when the time comes.
Medicare generally won't cover most ongoing custodial care. Family members may not be able to provide every service you need. And having sufficient financial assets doesn't automatically answer the questions of where you would receive care, who would coordinate it, or how your family would be affected.
A thoughtful plan brings those questions together before an unexpected health event makes the decisions more urgent.
Final Thoughts
At Cypress Wealth Services, we believe long-term care planning is ultimately about maintaining dignity, independence, and financial flexibility as life changes.
It isn't necessarily about purchasing insurance or predicting whether you will someday need assistance. It's about understanding the possibilities and making thoughtful decisions while you still have meaningful choices.
For couples, that includes considering how a care event involving one spouse could affect the other's retirement. For families, it means having conversations about preferences and responsibilities before a crisis occurs.
The goal is not to eliminate every uncertainty associated with aging. It is to create a plan that reflects your wishes, considers the people who may be involved in your care, and helps you approach the future with greater confidence and clarity.
About the Author
Ross Biesinger is a Partner and Senior Financial Advisor with Cypress Wealth Services. Ross works with individuals and families navigating retirement, wealth management, retirement income, and the financial decisions that accompany aging. His approach emphasizes comprehensive planning and helping clients understand how healthcare, long-term care, investments, and family considerations can work together as their needs evolve.
Aging with Dignity is an educational series focused on helping individuals and families better understand the financial and personal considerations surrounding aging and long-term care planning.
This article is provided for general educational purposes only and should not be construed as personalized investment, insurance, tax, legal, medical, or financial advice. Long-term care needs, costs, insurance availability, policy provisions, and government benefit eligibility vary based on individual circumstances and may change over time. Insurance products may involve premiums, exclusions, benefit limitations, waiting periods, and other restrictions. Cypress Wealth Services does not provide legal, tax, or medical advice. Individuals should consult appropriate financial, insurance, legal, tax, and healthcare professionals before making decisions based on their specific circumstances.
