π₯ Long-Term Care Cost Calculator
Project future care costs with health-care inflation.
Projected annual cost when needed
Estimates for planning only, not financial advice.
Long-term care is the most underestimated expense in retirement planning: about 7 in 10 people turning 65 will need some, and costs rise 3 to 5 percent a year, faster than general inflation. A $60,000 assisted-living year today becomes about $131,500 in 20 years at 4 percent inflation, and three years of care then totals roughly $410,400. This calculator projects your future annual cost and the total bill from today's prices, your time horizon, and care inflation.
Medicare does not cover custodial long-term care, a fact that surprises most families at the worst possible moment. The planning choice is binary: insure the risk in your 50s, or deliberately self-fund it with earmarked assets. Both beat the default plan, which is spending down to Medicaid.
How to Use This Calculator
Enter today's annual cost for the care level you expect, how many years until it might be needed, the annual inflation rate for care costs, and how many years of care to fund.
Enter the current annual cost. Use local figures if you have them; state medians vary wildly.
Enter years until care might be needed and the care-cost inflation rate. Four percent is the historical norm.
Read the future annual cost and the multi-year total. To fund it from investments, our retirement savings calculator shows what the earmark must grow into.
The Formula
Care inflation compounds twice: once while you wait, and again across the years of care itself. That double compounding is why the multi-year total shocks people. Three years starting at $131,000 a year with 4 percent inflation is not $394,000 but about $410,000, because years two and three cost more than year one.
Current Costs by Care Type
| Care type | Typical US median | Notes |
|---|---|---|
| Home health aide | ~$33/hour | Cost scales with hours needed |
| Assisted living | ~$64,000/year | Housing plus daily help |
| Nursing home, semi-private | ~$104,000/year | 24-hour skilled care |
| Nursing home, private room | ~$116,000/year | Highest standard tier |
These are national medians from the long-running Genworth survey; your state may differ by 50 percent or more. The table's real message is the staircase: each step up in care intensity roughly doubles the last step's cost. Planning for assisted living when nursing care is the risk leaves a six-figure gap. For the insurance-versus-savings decision, our RMD calculator helps high savers see forced withdrawals that could fund care.
Worked Example
With the defaults: $60,000 today, 20 years out, 4 percent inflation. The future annual cost is 60,000 x 1.04^20 = 60,000 x 2.1911 = $131,467. For 3 years of care, the total is 131,467 x (1.04^3 - 1) / 0.04 = 131,467 x 3.1216 = $410,389. The monthly equivalent in 20 years is $10,956. Costs will have multiplied 2.19 times while general prices at 2.5 percent inflation multiply only 1.64 times: care gets relatively more expensive, which is exactly why it needs its own inflation rate.
Planning Options
Three honest paths. Traditional long-term care insurance, bought in your 50s, transfers the tail risk for a known premium; the risk is future premium hikes. Hybrid life-plus-care policies cost more but return value to heirs if care is never needed. Self-funding works for portfolios above roughly $1 million by mentally partitioning $300,000 to $500,000 that is never spent on lifestyle.
My rule: decide by 55 and write the decision down. The families destroyed by this cost are not the ones who chose wrong between insurance and self-funding; they are the ones who chose nothing and met the nursing home invoice unprepared.
Who Pays for Long-Term Care
Most people are surprised to learn Medicare does not cover it. Medicare pays for short skilled-nursing stays after a hospitalization, up to 100 days with cost sharing, and nothing for custodial care, which is what most long-term care is. Medicaid covers nursing homes but only after you spend down nearly all assets, and coverage of home care varies by state. That leaves three payers: your savings, your family, or insurance.
Long-term care insurance makes sense in a specific window: enough assets to protect, typically $300,000 to $2 million, but not enough to self-insure comfortably. Buy in your mid-50s to early 60s, when premiums are still reasonable and you are insurable; waiting until health issues appear means declination. Hybrid life-insurance policies with care riders have grown popular because unused benefits pass to heirs, removing the use-it-or-lose-it objection. For the retirement funding behind all of this, our retirement savings calculator sets the baseline.
Estimates for planning only, not financial advice.Frequently Asked Questions
How much does long-term care cost now?
Genworth's Cost of Care Survey, the industry benchmark, has tracked these figures for two decades. Recent medians run roughly $60,000 to $70,000 a year for assisted living, over $100,000 for a nursing home private room, and about $30 to $35 an hour for home health aides. Costs vary enormously by state: Alaska and the Northeast run far above the median.
How fast do long-term care costs rise?
Historically 3 to 5 percent a year, faster than general inflation, driven by labor costs since care is hands-on work that cannot be automated easily. The calculator defaults to 4 percent. At 4 percent, costs double roughly every 18 years, so a 60-year-old planning for care at 80 faces more than double today's prices.
What are the odds I will need long-term care?
About 7 in 10 people turning 65 will need some long-term care in their lifetime, according to the Department of Health and Human Services. Average need is around 3 years for women and 2 for men, though averages hide a wide spread: many need none, and a minority need a decade.
Does Medicare cover long-term care?
Barely. Medicare covers short skilled-nursing stays after a hospital stay, up to 100 days with cost sharing, but not custodial long-term care, which is what most people need. Medicaid covers nursing home care after you spend down to its asset limits, which is why planning centers on either insurance or self-funding.
How much long-term care insurance do I need?
Enough to cover the gap between projected costs and what your income and assets can handle. Policies are usually bought in your 50s when premiums are affordable; waiting until 65 can double the cost or make you uninsurable. Compare the policy's daily benefit and inflation rider against the calculator's projected future cost.
Is self-funding long-term care realistic?
For households with $1 million-plus in assets, often yes: earmarking $300,000 to $500,000 of the portfolio for care is a common plan. Below that, one long nursing home stay can wipe out a lifetime of savings, which is when insurance or Medicaid planning enters the picture.
What is the difference between assisted living and nursing home costs?
Assisted living provides housing plus help with daily activities and runs roughly half the cost of a nursing home. Nursing homes provide 24-hour skilled medical care, which is why a private room exceeds $100,000 a year in most states. Home care falls between, depending on hours needed.
Should couples plan differently?
Yes. Women live longer and often care for husbands first, then need paid care themselves with fewer assets left. Couples should model two separate care episodes, not one, and shared-care insurance riders that pool benefits between spouses exist for this reason.
What is a hybrid long-term care policy?
Life insurance or an annuity with a long-term care rider: if you need care it pays out, if you do not your heirs get the death benefit. Hybrids cost more than traditional LTC insurance but eliminate the use-it-or-lose-it objection that keeps many people from buying traditional policies.
When should I start planning for long-term care costs?
In your 50s. Insurance is cheapest and health underwriting easiest then, and self-funders need 15 to 25 years of compounding to build the earmark. Waiting until 70 means paying far more for less coverage, or discovering the need with no plan at all.