3 Myths About Retirement That Will Cost You Money
November 08, 2018
Submitted by Edwards Group, LLC
1. You’ll retire at 70.
Think about your friends and family. At what age did they retire? This is probably a more accurate picture of what the reality will be for you.
2. It’s all fun and games.
An employee at a local nursing facility said in a recent conversation, “Everybody plans and thinks about retirement, but you can’t just plan for retirement. You have to plan for your health.” There will come a time (generally after the age of 75) where the traveling will wind down and your health issues will increase. Will you be ready for that?
3. Medicare covers everything.
Many people assume that once they turn 65, Medicare will take care of all their health needs. Generally, Medicare will only cover 48 percent of costs, and Medicare does not cover long-term nursing care. That leaves a lot of expensive medical care to be paid for out of your own pocket.
So, what can you do?
Life care planning is a new concept in the estate planning field that can help address several of these myths.
Life care planning helps people access quality care, maintain independence and mobility, stay in control of decision-making, and preserve legacies during the last decade(s) of life. Good, holistic planning looks ahead to the various stages that you or your family may go through during the aging process. Each stage has its own unique goals, pitfalls, concerns, and challenges. Some families skip around the stages; others miss certain stages altogether. Which stage are you, or your parents, in right now?
The six stages of life care planning
Stage #1: Healthy, but let’s look ahead.
In this stage, you’re still living at home, driving, traveling, handling finances, volunteering, and maybe even working part-time. Hopefully it will be 10 to 15 years or more until care is needed, but planning now can do the most good.
Stage #2: Not as young as I used to be.
In stage 2, people continue to drive, shop, and pay bills. They start leaning on family more for help or decisions. Increased health issues may even mean time in the hospital.
Stage #3: Needing more and more help.
In this stage, people start to struggle a bit with memory. Reliance on the family increases if the person still lives at home, or they may have recently moved into an independent living facility with their own apartment and meals provided. The person may drive only during the day or on short trips.
Stage #4: Declining, but still at home.
In Stage 4, people need substantial assistance. They no longer drive. They need daily assistance that may include dressing, getting up, eating, using the bathroom, bathing, etc. They lean on family for most, or all, legal and financial decisions.
Stage #5: Declining and in assisted living.
In this stage, loved ones have generally become too much for the family to take care of. They may be in and out of the hospital at this point. The family hopes assisted living will work long term, but there may be concerns that their declining health will require an even higher level of care sooner than expected.
Stage #6: In crisis, either in the hospital or nursing home.
During this stage, people are in the hospital, rehab facility, or nursing home. It is expected they will not be able to return home and an assisted living facility will not be enough. The next option is a skilled nursing facility, and the greatest challenge is finding good care and paying for it.
It can be very difficult to face the hard truth of retirement. However, by planning for the challenges of aging, you can reduce financial and emotional stress while making sure you can still accomplish your goals — whether that be maintaining independence, passing property down to your children, or preserving assets for charitable giving. We encourage you to give us a call at 217-726-9200 and reserve a spot at our upcoming workshop, Aging With Confidence: 9 Keys to Wise Planning & Peace of Mind. The workshop will be held in Decatur on November 6 and in Springfield on November 13. You can find more information on our website at www.EdwardsGroupLLC.com.
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