I turn 65 next year and will finally retire with $1.5M in my 401(k). But with a chronic health condition, do I also need long-term care insurance?

It's a common question — and a good one. Long-term care insurance (LTC) helps cover the high costs of in-home care, nursing facilities or assisted living if you need help with daily activities like bathing, dressing or eating.

But this coverage can be pricey, and the older you are when you apply, the more you’ll pay. Chronic conditions can make it even harder to qualify. As people live longer, interest in this type of insurance is growing. Is it really worth the cost?

How LTC costs rise over time

LTC insurance premiums increase sharply as you age. A man buying a policy at 60 might pay $249 a month. By 65, that jumps to $313. At 70, the cost is $410, and by 79, premiums average $676, according to Mutual of Omaha [1] estimates for California.

For women, the curve is even steeper. By 79, monthly premiums average nearly $1,300.

Monthly premiums for men and women

• Age 60: $249 / $425
• Age 65: $313 / $524
• Age 70: $410 / $662
• Age 75: $536 / $966
• Age 79: $676 / $1,296

These figures are just a guide. Premiums vary and depend on factors like age, gender, where you live and health conditions. Insurers set rates based on risk. Older applicants pay more because they’re more likely to use the benefits sooner. Women often pay more than men, partly because they live longer and are more likely to need care.

Chronic conditions like diabetes don’t automatically disqualify you, but they can mean higher premiums — or denial if not well-managed. That’s why applying before age 65 and while in relatively good health can be a smart move.

Now let's look at the numbers for this case:

• 401(k) balance: $1.5 million
• Social Security income: $2,000/month
• Mortgage payment: $1,700/month
• Estimated LTC premium (male, age 65): $313/month
• Annual LTC premium: $3,756

The premium would take about 16% of his monthly Social Security benefit and only 0.02% of his 401(k) balance, assuming no growth. It's noticeable but not overwhelming [2].

If he waits until 70, however, the costs increase by more than $100 per month. And at that point, he might not qualify for coverage due to his chronic health issues. So the window for getting affordable rates is closing.

Is LTC coverage worth it?

In this case, buying LTC insurance could make sense. With a strong retirement cushion and manageable expenses, he could afford it. The longer he waits, the pricer — and less attainable — it becomes. If protection is the goal, now is the time to act.

Pros:

• If LTC is needed, costs will likely exceed insurance premiums.
• Provides peace of mind.
• Can support aging at home (though not all policies cover this).

Cons:

• Premiums rise with age.
• May never be used if you die suddenly. *Chronic conditions can limit eligibility.

For those not ready to buy a policy, another option is a Health Savings Account (HSA) [3]. If available, it allows you to set aside money for future medical expenses. HSAs are triple tax advantaged — contributions, growth and withdrawals for medical expenses are all tax-free.