NEW YORK ( MainStreet) — About 46% of Americans have less than $10,000 saved for retirement, according to the Employment Benefit Research Institute. That means most workers will be scrambling when they hit their expected retirement age, which is now 67 years old rather than 63. One way to catch up financially is by purchasing an insurance policy with an attached long term care rider that pays cash or a long term care insurance policy with a cash benefit rider.

For example, Prudential's BenefitsAccess Rider attached to a life insurance policy advances up to 100% of the death benefit should the policy holder become chronically or terminally ill by drawing down 2% per month until the death benefit is met.

"A distinction between BenefitAccess and a long term care rider is that it pays based on a condition not for specific care of a condition," said Mark Hug, executive vice president with Prudential Individual Life Insurance.

While traditional long-term care policies require receipts and invoices to reimburse for licensed home health care, Prudential's BenefitsAccess Rider disburses funds no questions asked once a claim for long-term care is approved.

"The downside to such accelerated death benefits is that they reduce the overall death benefit which will be paid to the insured's beneficiaries when the insured passes away," said Scott Page, president and CEO of the Lifeline Program. "The cash value of the insurance policy is also reduced."

Largely seven in ten 65-year-olds will need care and $71 out of $100 of the cost of that care will be paid out by family members, according to Dr. Robert Pokorski, vice president and medical director of Prudential Individual Life Insurance. Thus, cash benefit long term care policies that pay cash can be used to compensate these informal family member caregivers as well as other expenses once eligible.

"We've been committed to cash since 2004," said Tricia Burnett, director of marketing and communications with MedAmerica. "We believe in cash because it provides people with a good deal of flexibility especially when they are relying on family caregivers."

Although MedAmerica phased out its Simplicity 2 policy, which paid cash whether a policy holder was under home health care, nursing home or assisted living, it continues to offer its Flex Care policy with a cash benefit rider but only covers home health care and assisted living.

"We also find MedAmerica's cash benefit rider helpful when our clients may possibly retire outside the United States," said Brian Gordon, president of MAGA Long Term Care Planning in Illinois. "Because most of the non-cash plans will limit the amount of time you can use the policy outside the U.S."

As for using the cash option for retirement expenses, the benefit would have to be triggered before money is disbursed.