The cost of living longer

Every day we see clients for whom long-term care is the elephant in the room. They feel like they can’t afford the cost, but they also feel like they can’t afford not to have it either. So their solution is to pretend not to see the “elephant” and try to ignore the problem until it goes away on its own. Unfortunately, this often leads to our metaphorical elephant trampling on their savings and future legacy they are trying to leave behind. The older you are, the more expensive a long-term care policy gets, and if you get sick before you have long-term care protection, it’s too late. Insurance companies watch their profits and an already sick senior will put them off.

The costs of these policies are also rising faster than inflation. Therein lies the conundrum for boomers and seniors: They live longer than their parents, and that means they need more money to get through “old age.” Finding long-term care is a difficult and complicated process. You will have to find a place that cares for people with your (or your loved one’s) circumstances. You have to find a place with the right facilities and staff, a place that gives you a good, safe feeling. And you also have to be able to afford it. This is not a one-size-fits-all situation. Everyone has their own specific services and conditions that they or their loved ones must meet. Remember, what we call “long-term care” is a broad category, with options ranging from live-in facilities to your own home.

The biggest threat to the financial security of Boomers and Seniors is the cost of long-term care (and Obamacare will not help). Assisted living facilities are now rising to the $7,500 per month mark and a private room in a nursing home will range from $500-$600 one day.

Many people choose to live in retirement communities where they can still be in charge of their own day-to-day lives, but without much of the regular stress of maintaining their own home. This option is usually a little more expensive than living in their own home, but it does offer the opportunity to “age on the spot.” Residents live in their own apartment and can increase their service level if they need it. For example: living completely independently, adding visits from health professionals, even to the community’s own skilled nursing home.

The cheapest option is of course still home care, but it also has other advantages: you don’t have to move, your mortgage is probably already paid off and you already know where everything is. Unfortunately, the cost of home care is also rising and can be more than many people realize when it comes time to pay. Fortunately, there are community health programs that can help with home care for those who qualify.

Some seniors have opted to buy long-term care insurance to cover these costs, but that’s also getting more expensive as companies raise their rates while lowering their coverage. In addition, this insurance becomes more complicated as it now has to cover aspects such as protection of the surviving spouse, issues with the caregiver, scams/identity theft and making sure you have a lawyer to fight for your rights in a system that is lopsided. to you.

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In short, we are living longer, and unlike previous generations, people generally do not live with or even near their children. Seniors will need more money for this extended life and for any unforeseen medical issues that may arise.

Do you know the fastest way for a Boomer or Senior couple to become an impoverished Boomer or Senior couple? Simple, one of them just needs to get sick before they get long term care insurance. We see it every day, people who have worked hard and saved money all their lives are forced to watch it wash away in a deluge of medical bills as they get older. It’s really heartbreaking because if you’d managed to throw away some cash, you probably could have afforded long-term care.

Our life expectancy is increasing these days and so are the costs of health care, the distance seniors live from their children and families, and the financial strain on Medicare and Medicaid. The new Affordable Care Act effectively mandates $500 billion worth of Medicare cuts in the next decade! Where do you go if you or your partner gets sick? Home care? Daycare for adults? Assisted living? A nursing home? Respite care, where the informal caregiver can drop the senior off for a limited period of time? Who’s going to pay it? And for how long? These are the questions to ask now while you still have time to plan. If you didn’t buy long-term care before you or your partner got sick… forget it. No one will insure you once you are sick! If this happens to you, you’re out of time, out of options, and soon out of money. And if you intend to leave something for your heirs, there may be nothing left to leave to them but a pile of bills.

It’s an old (but true) cliché: if you don’t plan, you plan to fail. When it comes to health care costs as you age, you don’t plan at risk for yourself and those you love.