When envisioning retirement, you may picture yourself somewhere tropical, close to family, or someplace with lots of activities and areas to explore. However, one activity you may have not envisioned is needing retirement care.
Retirement care is an urgent issue you need to plan for and address. The possibility that you will need help is high, whether at home or in a facility, due to injury, chronic illness, or decline in physical or cognitive function. You or your loved ones may need ongoing care in retirement from a home healthcare provider, in an assisted living facility or a nursing home.
When faced with the prospect of retirement care, more than half of Boomers (65%) would prefer to age in place in their current residence with or without modifications, according to a recent Bankers Life Center for a Secure Retirement study.
Although aging in place seems like it would be a simple adjustment, there are a few important things you should consider before making that decision.
Determine your lifestyle.
Before choosing to age in place, you will need to decide if staying in your home suits the lifestyle you want to experience during retirement. For example, do you want to travel extensively or live close to family? Do you place a high value on the comfort and familiarity of your neighborhood, or do you want a change of scenery?
It’s important to make sure your current home is in good standing for years to come and will be adequate for your needs. For instance, if you become unable to climb stairs in your home, how will that affect your ability to access what you need? Consider if the square footage of your home is too small or too large for you and your spouse to navigate. Given the size of your home, will it be sustainable for you to maintain your home, such as cleaning and repairs? If you anticipate needing to make home modifications, develop a plan. It’s never too early to start preparing for retirement care.
Do you have someone to care for you if needed?
By choosing to age in your home, this may affect your loved ones and those who may take on caregiving duties. With two-income households, busier lifestyles and longer distances between family units, it can be challenging for the modern family to carve out time and resources to care for an elderly family member.
According to the U.S. Census, by 2035, older generations are projected to outnumber children for the first time in U.S. history. A recent Bankers Life Center for a Secure Retirement study showed that almost half (46%) of middle-income Boomers expect to be caregivers in the future, and nearly all (92%) are willing to make lifestyle sacrifices in order to provide care.
Common sacrifices that these Boomers are willing to make to provide care for their loved ones include:
- Reducing other spending (66%)
- Traveling less (41%)
- Moving to a new home (27%)
- Working less (27%)
- Stopping work altogether (19%)
Although these future caregivers are willing to make these sacrifices, it’s important to have a frank conversation about how you and your loved ones will manage retirement care both emotionally as well as financially. If you think you might become a caregiver for a spouse or family member who wants to age in place, you should start learning about subjects such as Medicare, living wills and powers of attorney.
Address the costs.
The U.S. Department of Health and Human Services estimates that the average total cost for long-term care for Boomers is $138,000. Though this cost is simply an average, it may increase depending on your health as you age. Learn more about different care options and average costs here.
According to the Bankers Life Center for a Secure Retirement, 79% of Boomers have no money set aside specifically for their long-term care needs. And, one-third of caregivers have needed to use money they’ve saved for retirement to pay for health care expenses they incur while taking care of loved ones. This does not include additional costs you may face when making further modifications to your home so that you can continue to age in place.
Don’t let the cost of long-term care wipe out everything you’ve worked hard for. Take advantage of tools and resources that can help you better prepare.
Sources:
Bankers Life Center for a Secure Retirement, Retirement Care Realities for Middle-Income Boomers
U.S. Department of Health and Human Services
This article provides general, educational information and does not provide legal, tax or investment advice. Nothing in this article is intended to be a solicitation of insurance in any jurisdiction. Its purpose is the promotion of interest in Bankers Life and insurance in general. Any inquiries regarding the possible purchase of an insurance policy will be directed to a licensed insurance agent/producer, in which event an insurance agent/producer may contact you.
