You May Live Longer Than You Think : Financially Plan For It

A woman is helping an older man with his shirt off.


The Wall Street Journal recently ran an article entitled “Plan on living past your life expectancy,†which emphasized the fact that with people living longer, many outlive their money.  There are many reasons that this could happen, among them claiming Social Security too early, passing up the opportunity to buy annuities or long-term-care insurance, or simply mis budgeting.  Life expectancy refers to the average number of years someone will live from a given age, while longevity refers to how long someone might live if  everything goes well.  Many people, unfortunately, are ignorant of their so-called longevity risk, which is the probability of living a very long life.  Speak with your financial advisor to see if you are prepared for a long retirement.

Long Term Care Providers And Policy Holders Suffering

A woman is hugging an older man


I was fortunate enough to be able to buy a Long Term Care or LTC Insurance Policy that only required payments for 15 years, something which I don’t even think exists anymore.  Actuaries underestimated how long people would live and, as a result, have been paying out more LTC claims than originally projected.  This has caused many LTC providers to pull out of the market completely, and others to raise rates dramatically.  AARP The Magazine (December 2022/January 2023 Issue, page 28) profiled Terry Koplan, a retired Los Angeles resident who bought a policy with an inflation-protected benefit, currently $270/day, for an unlimited time.  However, he was recently notified that his annual premium would triple in 2024 to $14,315.  The insurer offered him other options such as cancelling the policy and refunding one-quarter of past premiums.  “ I feel like I have been completely cheated,†Terry told AARP.

Long Term Care Providers And Policy Holders Suffering

A woman is hugging an older man


I was fortunate enough to be able to buy a Long Term Care or LTC Insurance Policy that only required payments for 15 years, something which I don’t even think exists anymore.  Actuaries underestimated how long people would live and, as a result, have been paying out more LTC claims than originally projected.  This has caused many LTC providers to pull out of the market completely, and others to raise rates dramatically.  AARP The Magazine (December 2022/January 2023 Issue, page 28) profiled Terry Koplan, a retired Los Angeles resident who bought a policy with an inflation-protected benefit, currently $270/day, for an unlimited time.  However, he was recently notified that his annual premium would triple in 2024 to $14,315.  The insurer offered him other options such as cancelling the policy and refunding one-quarter of past premiums.  “ I feel like I have been completely cheated,†Terry told AARP.

Get Living Trust, Will, POLST And Power Of Attorneys In Place Immediately

A woman with grey hair sitting in a chair.


Based on a new survey done by AARP, our 60’s are a watershed decade when it comes to shifts in attitude regarding longevity, relationships, well-being and wealth.  At the same time, concerns about life expectancy dips, while worries about stamina, cognitive skills, diminishing eyesight and memory loss rises.  It’s not until people get into their 80’s that many people reported making necessary plans to help their families and medical team understand and carry out their end-of-life wishes, as well as planning for their assets, funeral and burial.  That seems like a long time to wait!  My suggestion is to get a living trust, will, POLST and medical and legal power of attorneys in place immediately.  You never know what the future will hold.

Monterey, CA Caregiver Costs Rising : It’s Expensive To Stay In Your Own Home And Independent

A jar of coins with the word retirement written on it.


A recent article in AARP Bulletin said that nearly 70% of senior citizens will require help from others to get through their day.  Women will need it for an average of 3.7 years and men 2.2 years.  However, having owned Family inHome Caregiving of Monterey and Santa Cruz for more than 12 years, I think these numbers can be low—some people require help for more than a decade.  Seniors are living longer, and if you live to be over 100 and need care starting at age 80, that can be two decades of monthly caregiving bills if you don’t have a relative willing to step in.  Unfortunately, Long Term Care or LTC Insurance is the only type of insurance which pays for having a caregiver come to your home, and few people have it.  I always urge the children of clients that we care for to get it while they can.  It’s very expensive and the younger you get a policy and the healthier you are the better rate you will get.  Some companies also give discounts if both a husband and wife buy a policy at the same time.

Pebble Beach, CA Caregiver Costs Rising : It’s Expensive To Stay In Your Own Home And Independent

A jar of coins with the word retirement written on it.


A recent article in AARP Bulletin said that nearly 70% of senior citizens will require help from others to get through their day.  Women will need it for an average of 3.7 years and men 2.2 years.  However, having owned Family inHome Caregiving of Monterey and Santa Cruz for more than 12 years, I think these numbers can be low—some people require help for more than a decade.  Seniors are living longer, and if you live to be over 100 and need care starting at age 80, that can be two decades of monthly caregiving bills if you don’t have a relative willing to step in.  Unfortunately, Long Term Care or LTC Insurance is the only type of insurance which pays for having a caregiver come to your home, and few people have it.  I always urge the children of clients that we care for to get it while they can.  It’s very expensive and the younger you get a policy and the healthier you are the better rate you will get.  Some companies also give discounts if both a husband and wife buy a policy at the same time.

Pacific Grove, CA Caregiver Costs Rising : It’s Expensive To Stay In Your Own Home And Independent

A jar of coins with the word retirement written on it.


A recent article in AARP Bulletin said that nearly 70% of senior citizens will require help from others to get through their day.  Women will need it for an average of 3.7 years and men 2.2 years.  However, having owned Family inHome Caregiving of Monterey and Santa Cruz for more than 12 years, I think these numbers can be low—some people require help for more than a decade.  Seniors are living longer, and if you live to be over 100 and need care starting at age 80, that can be two decades of monthly caregiving bills if you don’t have a relative willing to step in.  Unfortunately, Long Term Care or LTC Insurance is the only type of insurance which pays for having a caregiver come to your home, and few people have it.  I always urge the children of clients that we care for to get it while they can.  It’s very expensive and the younger you get a policy and the healthier you are the better rate you will get.  Some companies also give discounts if both a husband and wife buy a policy at the same time.

 

Monterey, CA Caregiver Costs Rising : It’s Expensive To Stay In Your Own Home And Independent

A jar of coins with the word retirement written on it.


A recent article in AARP Bulletin said that nearly 70% of senior citizens will require help from others to get through their day.  Women will need it for an average of 3.7 years and men 2.2 years.  However, having owned Family inHome Caregiving of Monterey and Santa Cruz for more than 12 years, I think these numbers can be low—some people require help for more than a decade.  Seniors are living longer, and if you live to be over 100 and need care starting at age 80, that can be two decades of monthly caregiving bills if you don’t have a relative willing to step in.  Unfortunately, Long Term Care or LTC Insurance is the only type of insurance which pays for having a caregiver come to your home, and few people have it.  I always urge the children of clients that we care for to get it while they can.  It’s very expensive and the younger you get a policy and the healthier you are the better rate you will get.  Some companies also give discounts if both a husband and wife buy a policy at the same time.

 

Inflation Hitting Caregivers Hard : Get Long Term Care Insurance (LTC) If You Can Afford It

A man and woman looking at a laptop


Inflation is at the highest level that we have seen in more than four decades, and it is taking a toll on family caregivers.  It’s so expensive, in fact, that Amy Goyer—AARP’s family and caregiving expert and an author of two books on the subject—had to file for bankruptcy after taking care of her parents.  Once she ran out of money, she started putting expenses on credit cards and things got out of control.  “I am a caregiving expert.  How did I end up in bankruptcy?†she told the Wall Street Journal.  People are living longer, which can be a blessing but also a curse.  After more than a decade of caring for her mother, who had a stroke, her father was diagnosed with Alzheimer’s so she had the burden of caring for two parents.  There are 53 million family caregivers in America who provide $470 billion per year in free care.  On average, caregivers spend 26% of their income on caregiving expenses, according to a 2021 AARP study.  The median average cost of care rose 18.5% from 2016 to 2020 and now stands at $55K per year, according to Long Term Care Insurance (LTC) Genworth.  Get LTC Insurance while you are still young and its more affordable.

Long Term Care Insurance Or LTC To Be Funded By The Government?

A stethoscope laying on top of papers.


Long Term Care or LTC Insurance is the only insurance policy which will cover the care of services provided by companies like Family inHome Caregiving.  Unfortunately, it is very expensive and few people have it.  A 2019 study funded by the National Investment Center for Seniors Housing & Care found that by 2029, more than half of the nation’s 14.4 million middle-income older adults won’t have the financial resources necessary to pay for senior housing or in-home care.  The study concludes that both public and private funds need to come to the rescue.  There is hope.  The Well-Being Insurance for Seniors to be at Home (WISH) Act would create a federal LTC trust fund that would pay for catastrophic long-term care for those who need it, and it would also allow private insurance companies to offer affordable coverage plans for the initial years of disability.  The plan would be fully paid for by a slight increase in the payroll tax (0.3% of income for both workers and employers), or roughly $300 per year for a median-income earner.

https://www.wsj.com/articles/social-security-costs-expected-to-exceed-total-income-in-2021-as-covid-19-takes-financial-toll-11630436193?mod=djemwhatsnews