Long-term care gap puts advisors in the spotlight as boomer costs soar

A new national study has exposed a stark disconnect between how Americans envision aging and how they are financially prepared to fund that vision; a gap that wealth management professionals say demands urgent attention from the advisory community.

Northwestern Mutual's 2026 Planning & Progress Study, conducted by The Harris Poll among 4,375 U.S. adults between January 5 and January 21, 2026, found that 73% of Americans would prefer to receive in-home care if a health event required long-term support.

The preference is even more pronounced among older adults: 83% of Boomers and their elders would choose in-home care over a nursing facility, compared with just 61% of Gen Z.

However, the financial groundwork to support that preference is largely absent. Fifty-four percent of Americans have not planned financially for their own potential long-term care needs, and 60% have not made any financial preparation for the possibility of caring for a loved one.

The advisor advantage

The data reveals a sharp divide between clients who work with a financial advisor and those who do not. Americans with an advisor are substantially more likely to have planned for long-term care: 66% have planned for their own care and 58% for a loved one's care, compared with just 34% and 29%, respectively, among those without an advisor.

"People are telling us they see long-term care coming, but awareness without action leaves families at risk," said John Roberts, chief field officer at Northwestern Mutual, in the company's October 5, 2026 release. "Many Americans do not know that Medicare generally does not pay for long-term care services. This is exactly the kind of blind spot a financial professional can help uncover, then connect to the rest of the plan."

That point is one financial advisors are increasingly being called upon to make as the intersection of health, longevity and client wealth management becomes a defining challenge of the next decade.

The cost curve

The financial stakes are substantial and climbing. The annual cost of a home health aide providing eight hours of care per day stood at $99,280 in 2025, according to the 2025 Northwestern Mutual Cost of Care Study, published March 2026 by illumifin Corporation. If costs continue rising at approximately 5% annually - a rate consistent with recent trends - the projected out-of-pocket annual cost of that same level of care could surpass $500,000 by 2058.

The projection is a planning reality, not a distant hypothetical. Many clients in their 40s and 50s who advisors serve today could face those costs within their lifetimes, precisely the cohort that long-term care planning should be centered on.

"Long-term care is not a side conversation in retirement planning," Roberts said. "It can be one of the largest and most personal expenses a family faces, impacting where people can age gracefully and how much of a legacy they can leave behind to others."

Younger adults are already caregiving

One of the study's more notable findings concerns younger generations already shouldering caregiving burdens. Twenty percent of Gen Z adults and 21% of Millennials currently identify as caregivers, higher than the 15% of Gen X and 10% of Boomers who say the same.

The financial consequences are real and immediate. Among current and former caregivers, 32% have decreased spending, 25% have drawn from personal savings or emergency funds, 21% have worked longer hours or taken on a second job, and 20% have taken on credit card debt to absorb the financial impact of providing care.

Overall, 66% of Gen Z and 67% of Millennials say they expect to provide long-term care for a loved one someday, yet financial preparation among these groups remains low. That is a client conversation waiting to happen.

"Caregiving is one of the most meaningful ways people support the ones they love, but no one should have to sacrifice their own financial security to provide it," Roberts said. "Thoughtful planning can help families navigate those challenges together."

A planning opportunity advisors cannot afford to miss

The study reinforces what many in the wealth management profession have long argued: long-term care planning is not a niche add-on but a core component of a durable retirement strategy. The data shows that the conversation between advisors and clients on aging costs needs to start earlier, ideally in a client's 50s, before a health event forces the issue.

The study found that 61% of Americans believe they are likely to need long-term care at some point, yet well over half have taken no financial steps to prepare. That gap between what clients expect and what they have planned is where advisors can deliver the most meaningful value.

"If Americans start the long-term care conversation early and build it into a comprehensive financial plan, they can create greater flexibility, confidence, and peace of mind for the years ahead," Roberts said.