A recent study spearheaded by Milwaukee-based Northwestern Mutual Life Insurance Co. has determined that while women may have a better grasp of long-term care options than men, they are less inclined to actively prepare for a long-term care event.
“Our goal was to find out or gage the level of awareness for long-term care planning amongst Americans,” said Angela DiCastri, director of retirement market at Northwestern Mutual.
Northwestern Mutual conducts studies periodically to take a pulse on the thoughts and concerns of its consumers. The company’s most recent report, titled “Long-Term Care Awareness Study,” aligned with November’s national recognition as Long-Term Care Awareness Month. The study was administered online in partnership with Harris Interactive and consisted of a national consumer opinion poll that surveyed 2,516 adults across the country between Oct. 2-4.
Survey questions covered topics related to consumers’ knowledge of long-term care plans, how financially prepared they feel for their retirement, and how exactly they’re addressing their potential long-term care needs.
“When we started looking at the results, we found a distinct difference between men and women in the way they answered the questions,” DiCastri said.
For example, 80 percent of women polled stated they were sure of what they would and wouldn’t need assistance with for a long-term care event.
But 30 percent of women surveyed stated they’re uncertain about how to plan for their long-term care needs compared to 18 percent of men surveyed.
Another finding noted that 24 percent of women polled were unsure of the options available in the case of long-term care need compared to 17 percent of men reporting uncertainty.
In regards to saving for long-term care needs, 37 percent of female participants stated they’re actively saving compared to 47 percent of male participants.
According to Rebekah Barsch, vice president at Northwestern Mutual, financial planning is crucial for women because, traditionally, they serve as the caregivers in their families and statistically they live longer than men.
Still, women don’t necessarily feel empowered to plan for the chance they’ll experience a long-term care event, Barsch said.
“The survey demonstrates that women aren’t translating their concerns into actions,” Barsch said. “The best way they can do so is by talking to an experienced financial advisor who can help determine a course of action to protect their nest eggs.”
DiCastri attributes women’s lack of adequate planning partially to their hectic schedules.
“I think part of it is they’re just busy,” DiCastri said. “Women tend to shoulder the bulk of the work at home, and I think they just haven’t really gotten around to (financial planning).”
Another contributor, she speculates, revolves around financial networks. Women may not always have as solid of a network of financial advisors men do and may not know who to call or where to start in the financial planning process.
DiCastri said the survey also aimed to educate consumers about six risks that can derail retirement: longevity, market, inflation and taxes, health care costs, leaving a legacy, and long-term care needs.
The cost of long-term care needs to accommodate an unexpected or long-term illness not covered by private health insurance or Medicare can potentially wipe out consumers’ retirement assets, according to Northwestern Mutual’s research. Statistics from 2011 reveal that an eight-hour home health aide costs more than $60,000 a year, care in an assisted living facility runs more than $40,000 a year, and care in a private room at a nursing home is about $90,000 a year.
Those present significant costs that individuals need to have insurance for or assets set aside to cover, DiCastri said.
Northwestern Mutual hopes the study raises awareness among both women and men about the impact of retirement risks on their future and further encourages consumers to be proactive in planning regularly for their retirement, she said.
“A retirement plan is not a one and done event,” DiCastri said. “It’s something that should be reviewed every year.”
