Nearly eight out of ten Americans acknowledge the increasing need for long term care (LTC) planning, yet nearly half (45%) aren't sure how they will address future LTC needs, according to a study released today by Northwestern Mutual Life Insurance Company.
The study also found that almost two-thirds of people believe the cost of providing LTC services will rise faster than the return on their savings, and that slightly over half believe that long-term care costs will double in the next 14 years. Yet, less than one third are currently saving for future LTC needs.
"There is a clear disconnect between what Americans understand about long-term care needs and the steps they've taken to prepare,'' said Steve Sperka, Northwestern Mutual vice president of long-term care. "In order to create flexibility and options in retirement, people need to address long term care risk as part of financial security planning.''
Northwestern Mutual's survey was conducted online by Harris Interactive from October 11-13, and comprised 2,194 American adults ages 18 and older.
According to the survey, an estimated 27% of women report that they have been a caregiver compared to 22% of men. Additionally, two-thirds of women polled said that they're more likely to report that the physical demand of caregiving is their biggest challenge versus less than 50% of men.
Compounding the issue is the fact that women, on average, live five years longer than men, according to data from the Centers for Disease Control. Despite this fact, the study showed that fewer women are saving for their future needs (24% for women vs. 32% for men).
"There's no doubt that long-term care is a pronounced issue for women, who tend to live longer and are more likely to provide care during their lives,'' Sperka added. "This just amplifies the importance of planning for women, in order to maintain control over their finances and lifestyle through retirement.''
The study found that respondents with caregiving experience are:
Almost twice as likely as those who haven't had caregiving experience to have discussed long term care options with family and friends (43% vs. 23%)
Almost twice as likely to have addressed the need for long term care within their retirement plans (30% vs. 17%)
More likely to understand their options and the resources available when it comes to LTC planning (56% vs. 34%)