Mellody Hobson: Preparing for Long-Term Care

5. Delay your retirement

Dreams of playing nine holes or basking in the warm Florida sun should take a back seat to staying at your job if you are concerned about the costs of long-term care. Not only does the longer period of time equate to more earned dollars and more time for your investments to grow, but also to a higher value of benefits received.

For example, a 40-year-old who makes $40,000 a year and opts for Social Security at the earliest possible time (62 years and 1 month) would be entitled to $955 a month in benefits. However, if the same individual delays retirement another eight years, they would receive $1,751 in benefits -- a difference of almost $800 a month!

6. Take advantage of catch-up provisions

Americans over the age of 50 can take advantage of "catch-up provisions" for their retirement. Through 2005, individuals age 50 and older may contribute up to an additional $500 to their IRAs per year, increasing to $1,000 in 2006. This additional allocation can add up nicely and make for a larger nest egg for your retirement. For example, if an investor catches up with $500 more a year for 15 years (assuming an 8 percent annual return) they would have $15,000 more than an investor who did not take advantage of the catch-up provision.

Mellody Hobson, president of Ariel Capital Management (arielmutualfunds.com) in Chicago, is "Good Morning America's" personal finance expert. Ariel associates Matthew Yale and Aimee Daley contributed to this report.