Celebrity and unlicensed financial advisor Dave Ramsey’s advice on when to buy long-term care insurance (LTCi) is wrong! For about 20 years, my colleagues and I have emailed, written, and called to offer him correct advice on when to buy LTCi. I’ve never gotten a reply from him.
Dave does not have an insurance license. He let his license lapse in 1996. Clearly, he does not have current knowledge of the LTCi marketplace. This does not stop him from giving advice on it. Worse, this does not stop many listeners from taking his erroneous advice!
Here’s Dave’s advice on long-term care insurance: https://www.daveramsey.com/blog/long-term-care-why-age-60. He is a staunch LTCi advocate, but on his terms (he’s the expert, right?). Life is supposed to turn out the way he expects it to, with no obstacles or roadblocks, I guess. He recommends waiting until age 60 to buy LTCi. I guess he believes nothing adverse will happen to listeners’ health before then. There are additional flaws in his simplistic thinking. Dave admits and does a good job of explaining why people save money by buying LTCi at much younger ages; how puzzling!
I have new clients who recently attended Dave’s Financial Peace University. They are 56 and 61 years old. Based on Dave’s advice, they suggested waiting to apply for LTCi until Mrs. was 60. I offered them correct information on why this is a bad idea, and proved my case. They listened and went forward with their applications.
Mrs. was declined long-term care insurance coverage because there is something neither of us could have known in her recent medical records. I am reasonably sure her LTCi application would have been accepted if she’d applied a couple of years earlier.
Mr’s. application was approved, but at a higher rate than we expected. This is because after a lifetime of very stable, low prostate levels, his prostate levels have recently climbed. They’re still well within the normal range, but the LTCi carrier spotted this. If he’d applied a year or so earlier, he would have gotten Preferred rates.
The correct age to buy LTCi is age 50 or younger, if at all possible. Many applicants over age 60 who are accepted for LTCi would have gotten lower rates had they applied sooner, not just because they would have locked in younger-age rates, but also because they had better health.
Suze Orman is another unlicensed, beloved celebrity financial pundit who proffered incorrect advice on when to buy LTCi for many years. But she learned firsthand why waiting until age 60 is wrong. See http://www.njltc.com/docs/Suze_Orman.pdf for her retraction of that advice.
The moral of this story is: do not depend on the advice of affable celebrities! If you want to take personal responsibility for your long-term care planning and make a confident, well informed decision on the best plan of action, seek the advice of an experienced, ethical LTCi specialist. Best time to buy LTCi is in your 40’s or 50’s, but we’ll still find affordable rates for you in your 60’s.