Insurance Options for Baby Boomers

Are you willing to risk all the wealth you’ve worked hard to accumulate over your lifetime on a single throw of the dice? You’re getting ready for retirement. Your mortgage is finally paid off (or close to it), you hold title to the car(s) in your driveway, and you’ve got a tidy sum tucked away in your retirement accounts.

What if you or your spouse were seriously injured or suddenly stricken with a major illness? When I was shopping for health insurance coverage recently, my agent told me something I should have known all along. He said that you buy health insurance to protect your assets. He’s right of course. I just never thought of it that way. My agent also explained that my individual coverage was so expensive because people in our age group (55 – 64) use more health services than younger people, yet we’re too young to qualify for Medicare.

Health insurance should properly be called sickness insurance. Insuring our health is our job, and as boomers we’ve done pretty well on that score. We’re more health conscious and generally in better physical condition than our parents were. But we live in a far different world. A hospital stay can easily cost hundreds of thousands of dollars. A single chemo treatment could cost you over $20,000. Health costs are insane! Nobody can withstand that kind of financial impact.

If you’re retiring early, you won’t be eligible for Medicare coverage until you reach 65. You don’t have much choice. You’ve got to buy your own health coverage, and when you do enroll in Medicare, you might be surprised at what isn’t covered. Medicare is a confusing alphabet soup with huge holes in the coverage that can drain you financially if you’re not prepared. You’ve got to plug those holes with a Medigap plan from a private insurance carrier. You can’t afford the alternative.

What happens if you or your spouse are unable to care for yourselves? Medicare only covers medical care, not custodial care. They will not cover the expensive custodial care provided by a nursing home. If you don’t have long term care insurance coverage you could be forced to sell all of your assets. Long term care insurance is another expense you might not want, but are you willing to take the risk of losing everything?

You and your spouse just might make it to a ripe old age with no real medical complications. Then again, you might not. Insuring your health and long term care may be a drain on your budget, but the alternative is unthinkable.