Statistics show that when it comes to senior care, most Americans are in denial about their future needs.
According to PBS NewsHour and the SCAN Foundation, 70 percent of Americans older than 65 will need some form of long-term care—yet very few do enough, if anything at all, to plan for this critical time in their lives.
Assisted living costs are rising faster than the pace of inflation, and the annual rate of increase has accelerated from near-zero in 2012 to 2.4 percent in 2015. The most recent quarterly report from the National Investment Center for Seniors Housing and Care shows rent growth in 2016 was at its highest level since before the 2008 housing market crash. For those choosing to move into private-pay assisted living communities, the median cost of rent and care in the United States is nearly $50,000 a year, and the costs rise to more than $60,000 per year for consumers who need specialized dementia care.
Stuart Furman, Esq., an elder law attorney in California for more than 34 years and author of award winning books the ElderCare Ready Book and the ElderCare Ready Pack, works with seniors and their families to create the foundation for their eldercare planning. According to Furman, finding the money to support senior care needs is difficult, but not impossible. He suggests starting with the following:
Consider the value of your assets, such as your home, and the cash you have saved. Then, figure out your anticipated senior care costs, including:
“People who are currently in the retirement phase with living parents should allocate money to help pay for their parents’ care costs,” Furman advises. “It’s expensive, so you will want to have funds to help your parents should their money run out.”
Helpful strategies include:
Unfortunately, there is a lot of misinformation available when it comes to senior care, especially on the internet. Insurance policies, living wills versus living trusts, the types of senior care available, state-specific programs—there is a lot of information to digest and keep straight.
Education can help defuse misconceptions about senior care, but Furman warns people to stay off the internet.
“Helping seniors differentiate products that are useful from ones that they don’t need or don’t contribute to the big picture,” is important, he notes. “There is a misconception that lawyers simply draft a document, but the document is really evidence of the legal service that is represented in that document. The time, effort and advice that goes into the document is not in preparing it but in taking the individual’s unique circumstances into consideration,” Furman said.
When it comes to senior care, you’ll likely need to rely on the advice of a number of professionals, including your:
It is important to communicate your plans with your family. Having these tough conversations will help ensure that your wishes are understood, not to mention help alleviate the concerns that your children or other family members may have regarding your care.
According to Furman, having long-term care plan discussions early on can help mollify the major areas of aging that seniors are most often concerned about, including:
Many people are dealing with financial and legal planning on behalf of their parents, especially when they begin noticing subtle changes in their parents, Furman notes.
“The parents themselves aren’t often aware of these changes in themselves, and this is a trigger for children to seek out legal advice without the parent to start, especially with long-term care plans or medical directives where the adult children are usually the instigator.” On the other hand, “With living trusts, the parents usually are the first ones to initiate the planning process.”
Whether you are looking out for yourself or your parents, planning and expert advice are critical elements to helping ensure you can afford the costs associated with senior care.