We spend our lives making plans and preparing for future events. From the beginning, we plan and work towards education, a career, and perhaps a partnership or marriage and a family. We work hard and save, invest and build our assets. We purchase insurance to protect our home, automobiles, health and medical needs.
So, by the time retirement comes, it might seem like the planning stage is over. After all, our finances and time have come together to allow us to enjoy the golden years of life. But with today’s longer life spans, the vast majority of us will experience an additional stage of life called eldercare. Unfortunately, very few people plan well for this part of their life, and as a consequence, leave the accompanied decisions and burdens in someone else’s hands.
The time to plan for this stage of life is well before health or unexpected circumstances force the discussion. The conversation should begin early – with parents taking the initiative and setting the plan for the children to follow. What wishes do you want your children, or friends, to carry out on your behalf? When it comes time for them to help, you may not be physically or mentally able to execute your wishes – and this is why having a long-term care plan is critical.
Four principles for an ideal long-term care planning process
- The more you understand your long-term care options, the better you’ll be able to plan for the future you want.
With so many options available, it’s important to learn the differences among senior care solutions so that you can make informed decisions for yourself and your family. Most care begins at home, and most caregivers are informal – meaning family, friends or volunteers. Beyond that, there is a wide range of housing and care types, including independent living, assisted living, home care, and skilled nursing care (for advanced health care needs).
- Professional help can save time and money – and reduce stress.
Long-term care services are complicated and expensive, and for the majority of Americans, eldercare is a do-it-yourself process. Whether you are considering your future options – or seeking help for a loved one – you may be surprised to learn that using a professional care advisor may be the most cost effective and efficient way to work through the complexity. Hiring professional advisors to help with long-term care is no different than using a professional to help with other challenging issues – and they can shine a light on the best path forward.
- When there is money available for care, options are expanded – meaning a higher quality of life for the loved one and less stress for the caregiver.
Without planned funding to hire professional advice or to provide the most desired care setting, the only option is to rely on Medicaid. This typically means a nursing home, which is the most costly and may be the least desirable care setting. To avoid a reliance on Medicaid, you have several common funding alternatives to consider:
- Long-Term Care Insurance
- Life Settlement
- Reverse Mortgage
- Cashing Out of a Principal Residence
- Retirement Savings Accounts
- Life Insurance Arrangements
The right mix of options will ensure that there is proper long-term care funding for you and your spouse.
- Long-term care planning works best when all key stakeholders are involved and informed – and the plan is backed by the appropriate legal documents.
A successful plan relies on individuals making their wishes known to family members (or other involved caregivers), which includes the clear identification of a chosen care advocate. No plan is complete without the finalization of all necessary legal documents (click here to read more about key legal documentation) and a formal meeting with all parties to review the full plan. This alignment is critical, and will greatly minimize confusion and stress and ensure that your wishes are carried out exactly as you have envisioned them.