Studies have shown that health care costs can rise dramatically in retirement.  Long term care can be very devastatingly expensive.  In an article in Money magazine, "Makeovers: Five Families Start Fresh," Sarah Max and Donna Rosato detailed for the subjects the need of long term care insurance to protect assets.

There is a better way.

Real estate investing with the acquired assets being held in a retirement account such as an individual retirement account (IRA) can take care of long term care costs, and many others in the interim.  It does not matter if the real estate asset is a turnkey property, small apartment building, private mortgage note, or even a flip, the advantages of placing it in a retirement account make this ideal for financing long term care and other needs in retirement.  This is due to the three main advantages of utilizing retirement accounts for real estate investing.

A major factor is that when the property is sold, there are no capital gains taxes.  Whatever is made, that belongs to the owner.  Assets sold within a retirement account are tax free.  That is ideal for flipping properties as there are no taxes no matter how many profitable sales.  Private mortgage notes, loans from an individual or a group of investors to another party to buy real estate, can also be sold for a tax free profit when done within a retirement account.

Another significant advantage is that here are no taxes on the investment income from real estate when it is in a retirement account.  If a small apartment building or turnkey property is producing rental income, it is tax free.  Just like the profit when selling, rental income is tax free when real estate is in a retirement account.

Risk management is also provided when real estate is part of a retirement account.  This is a critical part of all investing.  There can be no mortgage for any real estate when it is in a retirement account.  That protects the owner against the threat of foreclosure.  Downside protection like that is valuable all investing as eventually market conditions do become bearish, no matter what the asset class.

The most important consideration for utilizing real estate in a retirement account to pay for long term care is to start early.  

By far, being a passive investor with a long term approach is the best way to develop a retirement account bristling with real estate assets that can finance long term care, if needed.  If you are fortunate and do not need long term care, then the real estate assets in the IRA or other retirement account can pay for other needs.  If the protection of long term care insurance is still desired, then a cheaper policy can be purchased with real estate income from a retirement account covering the other costs.