You've Been Warned: The Incredible Cost Of This Care Could Make You Rethink Your Savings

While no one wants to think about their family member eventually passing away, the financial elements of that experience can have far reaching implications. This can be especially true for those who might require expensive long-term care. According to the U.S. Department of Health & Human Services, almost 70% of seniors needed some form of long-term care services as of 2020. While most people likely want as much time as they can reasonably have with an ill relative, making this a reality can be extremely difficult to navigate -– both emotionally and financially — with the average cost of nursing home care easily exceeding $100,000 in 2024, per The FLTCIP 2024 Cost of Care Survey.

We spoke exclusively with Mark Kennedy, President or Kennedy Wealth Management LLC, about the potential financial dangers of prolonged end-of-life care, "I have seen firsthand what the cost of end-of-life care and long-term care can cost families." Perhaps the most far-reaching element of these costs can be how they affect not just medical bills in the moment, but also erode funds meant to live on long after a person dies. While you might wonder what happens to a person's money if they die without a will, those needing expensive end-of-life care might not end up with any money to leave at all. 

Kennedy told us, "These expenses can be extremely high, depleting savings and impacting funds intended for heirs after death." Whether you find yourself concerned about the potential erosion of any nest egg you had previously planned to leave behind for your loved ones, or are concerned about the impact a relative's prolonged care could have on your own finances, it could be worth reconsidering a savings strategy in favor of specific insurance products.

While it might seem like simply saving more money could help people manage potential care costs, this isn't always an option for many Americans — especially considering the sheer amount of funds that might be required for care. Unfortunately for older Americans, and their families, the list of things that Medicare does not cover can have detrimental financial consequences. As Mark Kennedy explained, "Most long-term care is not covered by Medicare. The patient's healthy spouse or their adult children could be left paying for a sizable portion out of pocket until potential Medicaid eligibility. These huge costs can drain the healthy spouse's account, potentially affecting their own retirement security." While Medicaid could be option for some, the program's income and asset limitations could restrict eligibility. Plus, both the eligibility requirements and the benefits themselves vary considerably from state to state. Even if you find you do qualify, you could end up with few to no viable covered facilities in your area.

It's also worth noting that the exact costs of the care needed can vary considerably depending on the level of services required. For instance, according to CareScout, the median annual cost for in-home care services from a non-medical caregiver was over $80,000 in 2025. Meanwhile, annual community assisted living costs were almost $75,000 that same year, while nursing home care exceeded $115,000. On the flip side, day health care services had an annual median cost of just under $25,000. That said, if these expenses are not covered by existing medical coverage they can add up, and fast –- draining any remaining funds.

In addition to making sure to update certain assets as soon as a relative or spouse becomes ill, Mark Kennedy told us that there are some potential options available to help a family offset end-of-life care costs, "While it can [include] costly premiums, Long Term Care insurance can be a potential solution, but it is important to find a policy with a rate guarantee, since many companies are raising their rates on policies that were previously sold." While this insurance can help in the long-run — especially when compared to extreme care facility costs — the potential for high premiums could make it just as financially infeasible as the cost of the care itself, depending on your financial circumstances. 

With that in mind, Kennedy suggests that a hybrid approach that includes long-term care benefits with an insurance style model could be a smarter solution –- something like asset-based long-term care. Kennedy explained, "With this type of coverage, it is usually funded by a lump sum premium from the insured which buys a cash value life insurance policy [with a] larger death benefit than the premium." Perhaps the greatest element of this choice is its flexibility, "If needed for Long Term Care, the death benefit is 'accelerated' into a monthly payment until the death benefit runs down to near zero." This can offer families a financial lifeline when facing exorbitant long-term care costs, but it can also ensure that family members receive a death payment should that care not actually be needed in the end.