Ray’s Take: When thinking about your future, do you believe that you will be taken “feet first in a pine box” out of the home you worked so hard for during your younger years? Or do you sometimes get that uncomfortable feeling that you need to “knock on wood” as you look around at friends or acquaintances who have experienced a sudden change in health forcing a change in venue?
Since no one has a crystal ball, how do you deal with this issue?
Would your spouse be able to care for you, allowing you to remain in your home if your health failed? The spousal option also has to be weighed from the viewpoint of the health of your spouse in those years.
Would you be able to live with your children if you are no longer able to live alone and do not have a spouse?
Many people think “well, if the worst happens, I’ll just go in the nursing home.” However, this “solution” brings up a number of new issues.
The first is cost. The current average monthly cost of nursing home care in Tennessee is approximately $5,000. That adds up pretty quickly. Remember that Medicaid does not pick up the cost of the nursing home until you have spent down your assets. That means spent, not transferred to their kids.
Additionally, after a person who received Medicaid benefits passes away, the state must try to get whatever benefits it paid for that person back from their estate. In the event you are married, there are some exclusions regarding the sale of the home and protection of a specific allowable percentage of assets under the “spousal impoverishment” rules.
You should talk to your attorney or CFP who can help you gather information to assist you with making an informed decision that will make your life comfortable and find ways to leave money or other assets to your children or grandchildren without burdening them with legal concerns.
Consider your health, and the options for your care, when planning for the future so that you will have a comfort level with the “what ifs” that come along with growing older. After all, don’t we all want to feel good about the future?
Dana’s Take: Imagine yourself 10 years from now, 20, 30 and 40 years from now. Perhaps I’ve watched too many commercials for Centrum Silver, because I can only picture myself as a vibrant silver-haired woman walking on the beach. I can’t picture memory loss, wheelchairs or live-in caregivers. That must be a different stretch of beach.
Our imagination’s optimism about our future selves may explain why it’s difficult to forgo spending now to save for our future care needs. Facing the expenses of assisted living can be a real shock. I have recently learned of Medicare’s 100-day lifetime limit on paying for nursing home care. After 100 days, the patient is responsible for payment. Yikes.
Even if you can’t picture needing assistance, make sure you are setting aside enough to provide for the level of comfort and care you desire.
Ray Brandon is a certified financial planner and CEO of Brandon Financial Planning (www.brandonplanning.com). His wife, Dana, has a bachelor’s degree in finance and is a licensed clinical social worker. Contact Ray Brandon at firstname.lastname@example.org.