Having a financial plan when it comes to senior care is a must. Everyone knows that care like this can be expensive–and the cost adds up even more over the course of time. But the repercussion that is often overlooked is the fact that much of that cost comes out of the pockets of the younger family members helping to plan care, or more directly, the children of the person in need. This seriously erodes their own savings and can have an impact upon their own retirement and elder care planning.
There are things you can do now to offset the cost of care. Some are very easy, and some require more expendable money. Let’s take a quick look at a few of these to help you get some ideas for your own care planning.
Long Term Care Insurance: The earlier you purchase a long term care insurance policy, the cheaper it will end up being. The downside is that you will need to start paying for it earlier. But if this is not an issue, purchasing a policy for yourself when you are 40 or 50 can be a very smart investment, especially if you add on cost of living riders to help protect your money. Many policies include in-home care while others require a separate policy altogether if you want just this.
Medicare Supplements: These are talked about often, but are they worth the price? Depending on what your needs are, yes. All a Medicare supplement does is fill in the holes that are left with regular Medicare. Medicare has improved a lot over the last few years, but it still does not give you complete coverage. A supplement will help offset medication costs, lower copays, and if you find the right one, even help to make senior care cheaper.
Living Trust: A living trust is a legal document that stipulates how you want your money to be spent in the event that you cannot make decisions on your own. They are typically set up as a precaution in the event of dementia or if you become otherwise incapable of making a sound judgment on something. Using this to allocate some of your savings or Social Security payments toward care can be prudent.
There are some instances where families simply cannot afford senior care or any of the savings ideas stated above. In these cases, Medicare and Medicaid must be relied upon. The big drawback to this is that you have far less choice over which services you can use. Typically, they are just assigned to you and to get them changed can be excruciatingly slow. If this is something that you are currently experiencing, do know that many states are relying more and more on in-home care. The attention is individualized and a fraction of the cost of a nursing home. It is much cheaper to administer and to pay for out of pocket. If this is something that would benefit you, be sure to ask your state or county’s social services what you can do to move in this direction.
Leave a Reply