If Not Now, When?

It’s October. Pumpkin contests. Halloween. Start of 4Q20. COVID-19. Masks. Social distancing. Impeachment. Acquittal. Recession. Elections. Protests. Riots. Supreme Court justice death and nominee. Debates. Sports sans fans. West Coast fires. All-time low interest rates. And the list goes on.

The ultimate understatement

To say 2020 has been challenging is the ultimate understatement. We all have concerns. The cost of health care and long-term care being a major focus for most. 

One of the things that you can do about long-term care is develop a plan and share it with those who need to know that they are part of your plan. Will those who need to know be your spouse or partner, kids, siblings, friends? And, of course, your financial planner and estate planning attorney.

I’m an elder orphan. It’s the group that has no spouse, kids or family close by. We talk about our desires all the time. We all have estate plans. We all have long-term care insurance because we know we will need to pay for care should we need it. And most of us have first-hand experience caring for a loved one who needed care for a very long time. Years. Even decades.

It’s not difficult

Developing a plan for long-term care starts with three questions:

  1. If you needed long-term care, where would you want to receive care? Most of us want to remain at home. It is where we feel most secure and independent.
    • If home, is the house multi-story? If so, could it be made more accessible – first floor bedroom, ramps, walk-in bathtub, electric stair chair, etc.
    • Where would you want to live if widowed? Would you feel isolated at home?
    • If living in your own home were no longer an option, where would you want to live? Alternate care venues might include living with a child or family member, group or residential home, assisted living community, continuing care retirement community, nursing home or other options.
  1. If you needed long-term care, who would you want to provide care? Not burdening family members is a primary concern.
    • If married would your spouse/partner provide care. Or kids? Other family members? Friends? This is an opportunity to think through who could actually be a caregiver and delve deep into the pros and cons of each potential caregiver. 
    • How old is your spouse/partner? Will he/she be alive and healthy enough to provide care? Does your spouse want to be the hands-on caregiver? Does your spouse want to help you bath and dress or assist with toileting needs?
    • Could your kids provide care? Do they live in the same area? Do they work? Do they have kids of their own to care for? Are they really available to provide care?
    • Research tells us that the future financial security of children is negatively impacted by caregiving. We see income, saving, retirement contributions and Social Security benefits all reduced. And think about how the dignity of family relationships would change as kids become hands-on caregivers involved with bathing, dressing, toileting, etc. 
    • Care providers might include a spouse, partner, significant other, child, sibling or other family member, a friend, volunteers, paid caregivers or other options.
  1. If you needed long-term care, how would you pay for it? Not burdening family and remaining at home equates to privately paying for long-term care. Private pay means self-funding expense from income, savings and investments or funding with the benefits of private insurance. 
    • If you plan to self-fund, what assets would you liquidate to pay for care? How would that impact income? Taxes?
    • Would you consider a reverse mortgage?
    • Would family members help pay for care? Or insurance premiums?
    • If Medicaid is your funding option, detail assets you would gift, transfer or spend to qualify.
    • If private insurance, define the amount of expense you need to offset through insurance and a comfortably affordable premium budget. 
    • Do you have other funding opportunities such as other government agencies or private charities?

If you will think through these three questions and write down your desires you are well on your way to designing your plan for long-term care. 

Having a plan can solve the key concerns we hear when clients explore long-term care insurance:

  • Not burden kids
  • Remain at home
  • Afford quality care
  • Transfer wealth
  • Not outlive income
  • Not impact loved ones’ standard of living