I watched my grandparents plan carefully for their future. They thought through succession, made sure their kids would be taken care of, and had a clear vision for what happened next. Unfortunately, not all families have everything so carefully planned out. If illness or age meant years of nursing care, the whole plan would fall apart, and assets would be sold to pay for care instead of going to the next generation.
That's the gap most families have: a financial plan, but no plan for long-term care costs. It affects small business owners, families with homes and investments, agricultural operations, and anyone who's built something they want to pass on. For rural families especially, long-term care planning looks different from what it does in towns and cities.
What is Long-Term Care?
Long-term care is ongoing help with daily activities because of illness, injury, or age. That might be bathing, dressing, eating, managing medications, or other tasks you can't do independently. It's not medical care, it's support with living. It can happen at home, in an assisted living community, a memory care facility, or a nursing home.
The Reality of Rural Long-Term Care
In towns and cities, families are able to hire home health agencies if someone needs in-home care. In rural areas, that's not an option. Home health agencies won't travel long distances, and they often don't serve rural counties at all. If you want to stay in your home and need care, it falls on family or friends to provide it.
That's the reality most rural families face. You can't hire it because it's not available, so you’ll either need to rely on family, move closer to town, or go to a facility. That starts a different conversation than most long-term care planning addresses.
Three Conversations That Matter
You don't need a complicated long-term care plan. Start with three conversations:
First, talk to your family about what you actually want. If you needed ongoing care, would staying home be realistic given that in-home care agencies may not serve your area? Would you expect family to provide care? Are you open to moving closer to a facility? What matters to you about your quality of life? Your family can't help you get what you want if they don't know what that is.
Second, look at your finances with your advisor.
- How would you pay for long-term care if you needed it?
- Do you have savings set aside?
- Should you get long-term care insurance?
For rural families, there's an important distinction: some policies are indemnity policies, which let you pay whoever provides your care, like a family member, a friend, a hired caregiver. Other policies are reimbursement policies, which require you to pay first and then get reimbursed by the insurance.
For rural families where family care is the likely scenario, an indemnity policy may make more sense because you can pay family members directly for the care they provide.
Third, make sure your family knows where your documents are and what your wishes are. Sharing information is the foundation of a plan.
Long-Term Care Insurance: Indemnity vs. Reimbursement
Long-term care insurance comes in two main types. Reimbursement policies are the traditional option: you pay for care, submit receipts, and the insurance reimburses you. This works well if you're hiring agencies or facilities.
Indemnity policies work differently. The insurance pays you a daily or monthly benefit amount, and you decide how to use it. You can pay a family member to provide care, hire someone independently, or use it however makes sense for your situation. For rural families where family care is realistic, indemnity policies are often the choice.
Talk to your advisor about which type makes sense for your situation. The point is making an intentional decision based on your actual options, not assuming you'll have access to home health care.
Protecting Your Legacy
Long-term care planning isn’t about obsessing over worst-case scenarios. It's about making sure that if something happens, your family gets the outcome you'd choose, not the one that's forced on them by circumstances. It's protecting what you've built—your home, your business, your investments, your family's future.
Start the conversation now, while you're healthy and thinking clearly. Talk to your family and your financial advisor to determine what makes sense for your situation.
Frequently Asked Questions About Long-Term Care Planning
How much does long-term care cost?
Costs vary depending on the type of care and your location. Assisted living facilities average $60,000 to $80,000 per year. Nursing facilities can run $80,000 to $100,000 or more annually. In-home care through agencies typically costs $50,000 to $70,000 annually, but that option isn't available in most rural areas. If you need care for five to ten years, those costs add up quickly. Without planning, families often have to sell assets to cover these expenses.
Should I get long-term care insurance?
That depends on your age, health, assets, and how much you want to protect your family's inheritance. If you have substantial savings, self-insuring might make sense. If your assets are modest, insurance protects what you've built. For rural families especially, the right long-term care insurance can ensure that family members who provide care get compensated. Talk to your financial advisor about what works for your situation.
How do I start long-term care planning?
Begin with a conversation with your family about what you'd want if you needed ongoing care. Then talk to your financial advisor about your options and whether long-term care insurance makes sense. Finally, make sure your family knows where your important documents are and what your wishes are. That's the foundation of a plan that actually protects your family.
When should I start thinking about long-term care planning?
Start now, regardless of your age. The younger and healthier you are, the easier it is to get long-term care insurance if you decide you want it. Even if you don't buy insurance, planning now means you make thoughtful decisions instead of reactive ones in a crisis. Have the conversation with your family while you're healthy and can communicate clearly about what matters to you.
What's the difference between indemnity and reimbursement long-term care insurance?
Reimbursement policies reimburse you after you pay for care. You submit receipts to the insurance company, and they pay you back. Indemnity policies pay you a daily or monthly benefit amount regardless of what you spend. You decide how to use the money: to pay a family member, hire independent caregivers, or cover facility costs. For rural families where family care is the likely scenario, indemnity policies often make more sense because you can pay family members directly for the care they provide.
Ty McDonald is a financial advisor at Down Home Financial. To discuss long-term care planning as part of your overall financial strategy, reach out at (406) 625-3368.
Content in this material is for general information only and not intended to provide specific advice or recommendations for any individual.