[notmyjob]

The problem with LTC insurance is it’s likely to go belly up and you are at the end of the day dealing with an insurer whose business model involves denying valid claims. All of that is assuming you can actually get LTC insurance. Good luck if you are over 50. It’s like the private form of social security, a Ponzi that’s approaching its moment of truth.

[leoqa]

You’re probably correct (I’m 30 and don’t have a policy) but I can’t think of any financial instrument that would guarantee skilled nursing ($4-8k/month in MCoL) for 10-20 years. No one in the bottom 90% of American earners can afford that drawdown even if they saved considerably.

[nostrademons]

That’s sorta the point, and the problem. There’s a dependency ratio problem brewing: there are simply not enough working-age people to care for the old people who will need care. No amount of financial instruments can paper over this reality - they will just go bankrupt (eg insurance policies, social security) or steadily drop in value relative to the cost of care (401ks and other financial instruments) until the price of LTC equilibrates to actual capacity. Anyone not in the percentile that actually has eldercare capacity will simply have to go without, much like the price of housing has risen to shut out Millennials that are not in the income percentile needed to get one of the few scarce houses for sale.

[spwa4]

No worries, the EU (and UK) governments have gone ahead and taken the only real way out of this conundrum: researching robotic labor to take over for this ... and defunded it.

[Retric]

That’s not the only solution, curing dementia would largely solve the manpower issues here.

Rapid population decline is a separate issue that makes this problem seem much worse. In other words, if elderly care works in a steady state population then it’s a symptom here not a cause.

[spwa4]

You have seen the protests in France? Raising the retirement age will not go over well, to put it mildly.

Bloquons tout!

[Retric]

Increasing the retirement age isn’t necessary. It increases overall prosperity in exactly the same way all those things that increase productivity do by allowing you to use extra labor on other problems.

Instead changing demographics means retirement benefits may need to alter their payout formulas, but more prosperity means more money for retirees in absolute terms even if they keep receiving the same percentage of GDP. IE X% of per capita GDP in 2025 is way higher than X% of per capita GDP in 1975 adjusted for inflation easily offsetting increased lifespan. The same is nearly guaranteed in another 50 years.

[bluGill]

Most people won't need it for long and so the risks average out to a more reasonable cost. However it is still thousands and people buy cheap not best coverage when they need it so that is what the market provides.

[supportengineer]

Every insurer's business model involved denying valid claims.

By maximizing the float you can maximize risk-free returns