Format for printing

Medical insurance isn't the only type of coverage we should consider. Some Fools may want to investigate long-term care insurance, too, to cover stays in nursing homes or assisted-living facilities. These policies come in many forms, but all have one thing in common: They are not cheap. But neither is nursing home care in old age -- the average cost right now is $37,000 per year. This is another area where shopping around long before you need it will pay off in the long run. Remember: the younger you are at first purchase, the lower the cost.

The United Seniors Health Cooperative, a nonprofit consumer organization devoted to the issues of the elderly, maintains that long-term care insurance is appropriate provided it costs no more than 7% of your retired income and:

• You have $75,000 or more per person in assets, excluding a home and a car.
  
  
• You have a retirement income of at least $35,000 per person per year.
  
  
• You can pay the premium without adversely affecting your lifestyle.
  
  
• You could absorb up to a 30% increase in future premiums if necessary.

Life Insurance
Finally, we need to consider life insurance in our retirement plans. At retirement, life insurance needs are usually far less important than they were while we were working full-time. But for whom? After all, the kids are out on their own now, right? If they're not, you might want to go to a summer camp football clinic led by a former NFL great in which you can practice drop-kicking them out of the house. In retirement, the only person to worry about is usually a spouse -- who should enjoy the same standard of living after we're gone as when we're alive.

So it follows that you'll need sufficient life insurance in order to assure that for your loved one, right? For Fools, probably not. That's because we have already provided for that spouse in our planning. Let's explain.

One of the goals of retirement planning, you see, is that the departure of either spouse should have no effect on the ability of the other to survive comfortably. You then only need enough life insurance coverage to pay for all, um, final expenses and funeral costs. Coverage beyond that is unnecessary, unless we're planning on leaving someone a large pile of cash to remember us by. If need be, we might wish to carry more insurance so the family could pay any estate taxes due when we die, but that's a matter for discussion with an attorney.

In most cases we shouldn't need large amounts of coverage. At retirement, then, we definitely want to look at our life insurance needs so we only carry the minimum coverage.