Long-term care planning presents a conundrum: It asks families to prepare for an event, without that event being certain.
Most clients won’t know if they’ll need care, how it’ll look, or how long it may last. But that ambiguity doesn’t make care planning an issue to postpone.
What’s at stake is an unexpected care need and how that can affect a plan you’ve spent years building with a client.
Significant expenses could appear at an inconvenient point in retirement. Family members may become caregivers by default. Assets earmarked for income or a surviving spouse may suddenly have another job.
That’s why long-term care deserves to be viewed alongside longevity, inflation, market risk, and other variables already being considered in your retirement planning.
These trends make that conversation particularly relevant right now.
The Long-Term Care Risk Is Bigger Than One Statistic
Roughly 7 in 10 US adults turning 65 are projected to develop a disability that requires implementing care services and support. Durations and intensity of care will vary of course, but the possibility is significant enough to include in clients’ retirement plans.
In a recent analysis, the Office of the Assistant Secretary for Planning and Evaluation estimated the average projected care duration is a little over three years, but that 22% of Americans may need care for over five years.
While the exact estimates can admittedly vary by sources, you don’t need to settle the score with on headline.
The practical takeaway here is there’s a meaningful chance that a client could need assistance, and there’s considerable uncertainty around how long that care could continue. Both variables deserve consideration when you’re stress-testing a retirement plan.
Care Costs Can Test More Than Net Worth
Cost is usually where the care planning conversation gets everyone’s attention.
The CareScout Cost of Care Survey, released in early 2026, provides useful national benchmarks:
- Adult day health care: $24,700 annually
- Assisted living: $74,400 annually
- Non-medical home care at 44 hours per week: $80,080 annually
- Semi-private nursing-home room: $114,975 annually
- Private nursing-home room: $129,575 annually
Granted, these are national medians and not predictions of what any individual client will spend. Geography, the amount of care needed, setting, and available family support can produce a much different result. But the expenses are startling.
CareScout also reported year-over-year increases ranging from 1-5% across most care settings in 2025, including 5% for assisted living and 3% for non-medical home care.
This is where you can take the conversation further than a cost-of-care statistic.
Imagine a client who appears financially capable of absorbing a substantial care expense:
- Where would the money actually come from?
- What assets are liquid?
- What would withdrawals mean for taxes and retirement income?
- What if increased withdrawals coincide with a prolonged market decline?
- What resources still need to be available for a healthy spouse?
Long-term care risk is ultimately connected to the rest of the client’s financial picture. For client conversations, a good one-liner to remember is: “A large balance sheet and a well-funded care plan aren’t necessarily the same thing.”
Medicare and Medicaid Can Create a Planning Blind Spot
Medicare and Medicaid frequently enter care planning conversations, but neither should be entered into the plan simply as “care covered.”
Medicare and Medigap generally don’t cover non-medical care received at home, in the community, or in a nursing facility. Medicare can cover qualifying short-term skilled care, but that shouldn’t be confused with open-ended custodial care that some clients may assume Medicare covers in a future care event.
Medicaid, on the other hand, presents a different planning issue.
Medicaid can cover certain care services, but eligibility is means-tested, and requirements vary by state and coverage pathway. Income limits, asset rules, spousal protections, and covered services can all affect eligibility. Estate recovery may also apply to certain Medicaid benefits provided to some enrollees age 55 and older.
Knowing this when an assumption about public benefits needs closer examination can be just as important, particularly when that assumption affects the retirement plan you’re helping build.
Don’t Let the Family Become the Default Care Plan
Here’s another scenario worth testing during a client review, when they say: “My kids will help.”
Maybe they will. Maybe they won’t. But what does “help” really mean?
The 2025 Caregiving in the U.S. report estimated that 63 million Americans are caregivers, or about one in four adults. Half of caregivers reported a negative financial effect from providing care, and about 25% said they had taken on debt because of caregiving.
Debt can come from an adult child who may need to reduce work hours or travel regularly. Or a spouse may be able to coordinate care but unable to physically provide it. Siblings could have very different ideas about who will contribute time and who will contribute money (if at all).
Admittedly, these aren’t easy topics to discuss. But they’re also hard to address for the first time once someone needs assistance.
As an advisor, you’re in a position to prompt the conversation earlier. Who is actually available? What help can that person realistically provide? When would paid care enter the picture? And has the family discussed any of this together?
Stress-Test the Care Plan, Not Just the Portfolio
You don’t need to predict a client’s exact long-term care journey to make the planning conversation useful. Instead, consider testing a few reasonable scenarios.
Like what happens if a client needs part-time help at home for two years? Or how does the plan react to an eventual move into assisted living? Where would funds come from during a longer and more expensive care event?
That review can expose inquiries that a traditional retirement projection may not. Consider these questions:
- Is enough of my client’s wealth readily accessible?
- What happens to retirement income as care expenses increase?
- Which assets would be tapped first?
- Is existing insurance available, and what does it actually cover?
- How much unpaid care is the plan implicitly assigning to family?
- What resources need to remain intact for a surviving spouse?
- Are legal documents and decision-makers prepared for a care event?
A client doesn’t need a perfect answer to every question in one meeting, but identifying where the plan depends on untested assumptions is a step in the right direction.
Make Care Part of the Ongoing Planning Conversation
Care planning shouldn’t be a conversation you have once when someone asks about insurance.
Clients’ health changes. Family dynamics change. Assets change. Local care costs change. And because of that, a strategy that looked reasonable at age 58 may deserve another look at 64 or 71.
That creates a reason to revisit care planning during retirement reviews alongside the other risks you’re already monitoring.
Start with the exposure: care preferences, funding resources, family capacity, and the effect a prolonged care event could have on retirement income. From there, you can determine where the plan is prepared and where another conversation may be needed.
Understanding the risk is only half of the discussion. In our next article, we’ll look at the funding and planning approaches advisors can consider when those gaps start to emerge.
