As you get older, there are a number of concerns you need to deal with, not the least of which are financial concerns. In fact, most things you need to deal with involve finances in one way or another, and when you’re on a fixed income, it’s more important than ever to be prepared. The same applies if you are someone in charge of caring for an older person, such as a relative, neighbor, or friend.
One of the most common questions we hear at every stage of our adulthood is, “Are you saving for retirement?” This stems from the fact that financial support for senior living expenses is often a struggle. If you are a caretaker, either as a child or a spouse, of someone who is in need of senior living, you are tasked with finding a financial solution. If you are a senior yourself, then you understand all too well the stress and strain of finances or lack thereof. Here is a comprehensive guide to assist in finding financial support for your perspective.
Let’s take a look at a few of the topics you should know about.
Topics Covered In This Article:
- Senior Living Options
- Facility Costs
- Personal Finance Options
- Bills & Records
- Financial Plans
- Insurance Plans
- LTC Reform
- Reverse Mortgages
- Social Security
- VA Benefits
- Government Services
- Affordable Living Programs
Senior Living Options
The biggest expense for seniors is housing. In addition to having a place to live, most seniors require more advanced care. This ranges in cost, level of care, and supervision. On one end of the spectrum, there is adult daycare, which is a low-cost program in which seniors receive daytime socialization and supervision. At the other end, there is nursing home care and in-home care. This is the highest level of care with 24/7 supervision by a registered nurse, along with rehabilitation services.
Other high-cost senior living options include a retirement community where individual seniors rent or own housing properties. This community provides specialized services, such as on-site chefs, valet drivers, organized social activities, and onsite emergency care. Along these same lines are continuing care retirement communities.
Here is a breakdown of the three main types of senior living services that are most commonly utilized by seniors:
- Retirement communities include senior apartments that provide total freedom but social access with other seniors; senior co-op in which seniors live in a community and share the costs of services; and independent living communities for seniors who want to enjoy senior activities and 24/7 emergency care, but still retain their own living environment.
- Assisted living facilities provide seniors with more personal, one-on-one care and often include personal care services, such as hygiene, transportation, medication, finances, and entertainment.
- Respite care, dementia/Alzheimer’s care, and hospice care are all in-home senior care services focused on a specific situation. For example, with dementia/Alzheimer’s care a patient requires a skilled nurse trained in helping seniors with this condition. Hospice care is an end-of-life in-home senior living service that helps seniors and families remain comfortable while transitioning to the final stage of life.
When handling the finances for senior living, the first goal is to choose the type of housing arrangement(s) that will best serve the senior’s needs. Keep in mind in most instances a senior will transition to more than one type of senior living arrangement in their lifetime. By understanding the options available for seniors, you can identify senior living services that fit your budget and level of care needs. Now let’s discuss all of the ways you can financially afford senior living.
The first place most people look for financial support for seniors is via a retirement savings account. If your senior worked for an employer at any time since the 1970s, they may have a retirement fund. You will need to find the documents containing the account number and related information to access this account. Here are some of the most common types of retirement accounts in the US:
- Thrift Savings Plan
A 401k is the most common type of retirement plan because it is available to employees at their workplace. The 403b plan is also referred to as a TSA or tax-sheltered annuity. This type of plan is available to select ministers, nonprofit organization employees, and public school employees. Good to know, if the enrolled individual is over 50 they can make catch-up contributions of up to $6,000 annually.
A 457b retirement plan is available to employees of schools, hospitals, churches, or charities run by local or state governments. The Thrift Savings Plan is part of the Federal Employees Retirement System. This is available for those in civil service or members of the military.
IRAs are discussed later on.
What is the Cost of Nursing Homes?
The average cost for a private room in a nursing home in 2016 was $92,000 annually, based on information gathered by Genworth Financial. This works out to about $253 per day—an increase of 1.2 percent from the previous year. Since Medicare-certified nursing facilities make up over 90 percent of facilities around the…
This article was sourced from Senior Living.