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Thanks again for all the thoughts.
We have a family meeting planned with my dad this weekend to talk through a lot of this stuff. I'm generally leading towards a combination of selling the second property and using a portion of the 401k to come up with some way to pay the mortgage on the family home. Whether that is via an annuity or just taking distributions as needed. I will also run the numbers (or ideally find a CFP who can help) to determine whether it makes sense to pay off a chunk of the mortgage with the proceeds of the second property or invest that money and use distributions and/or purchase an annuity. |
#47
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#48
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And if you can, save even more. Healthcare costs are high and rising, and you need more service in your old age. The national avg assisted living cost is $3,750 monthly ($45k annual) and nursing home is $7,150 monthly for a semi-private room ($85.5K annual). Some 65% of nursing home residents are on Medicaid because they don’t have the funds to pay. Sent from my iPad using Tapatalk
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#49
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#50
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LT Care insurance is a difficult financial decision. Premiums have been rising sharply, surprising many current policyholders. For some policyholders, the premiums have become too expensive and they have dropped the coverage/policy. And benefits on new policies have been greatly reduced. Many insurance companies don’t write the business anymore, as they can’t estimate the costs and price it correctly. There’s a only a few big insurance companies that still have this product line. Sent from my iPad using Tapatalk
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i've found they typically jam it into a whole life policy package, can't buy it separate. at least from the folks i spoke with.
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#52
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IMHO LT Care insurance is a difficult decision. What you are really insuring is the person's assets, not paying a nursing home bill. If the person has enough money in old age that they will always be able to pay the nursing home bill, no matter how much or for how long......then a LT care policy can help preserve some assets for a later generation.
But if that person has modest assets, that will be used up quickly in a nursing home, then IMHO a LT care policy is a waste of money. Medicaid will pay the bill anyway. My mother in law did what she was supposed to do in life. She was a retired nurse (WW11) who saved her money all her life. She raised her kids, educated them, then cared for an ailing husband, who finally passed away. In her late 80's she still had more than $100,000 in savings, after using most to care for her ailing husband. In her early 90's, she was in and out of the hospital a few times on medicare. The last time in the hospital she was advised to go to Rebab. So after her last surgery.....she went to rehab.....medicare pays for 20 days......then she still had to stay another month, then she became a permanent resident of a fairly nice skilled care facility.....at about $9800/month. So she spent her own money until she was broke and qualified for Medicaid. She had purchased a LT care policy when she was about 65 years old.....premium about $2300/year....from John Hancock (a great company to deal with now BTW)......which would reimburse up to $100/day after a 100 day waiting period. So now.....Medicaid takes her SS check minus $105/month for personal use, and the state takes her LT care reimbursement. If she did not have the LT care policy, the state would pay all her nursing home bill. BTW....The states don't pay but about 1/2 what a private person pays....so individual paying residents partially subsidize the Medicaid system. So while she still thinks she did the right thing in attempting to be able to pay her bill....she did spend more than $50,000 for the LT policy that was unnecessary....as we look back on things. So just realize that you are unlikely to be able to afford enough LT care insurance to pay a full skilled care nursing home bill. And if a person is wealthy enough to be able to afford that kind of bill, a LT Care policy will help preserve some of the family assets. If the person is of more modest means.....then Medicaid (currently) will pay her bill. Most of the people where my mother in law live have their bills 100% paid by Medicaid after they surrender their SS checks. They have long since spent down their savings. They are not lazy, shiftless, or in any way not great Americans...as many are portrayed. Many are WW11 veterans. They did what they were supposed to do in life. They just ran out of money before they died. At almost $10,000/month, how many of us could pay our way for a long time? This system needs a permanent fix and a source of funds. Last edited by Ralph; 04-26-2018 at 02:58 PM. |
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nailed it, 100%.
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Both our grandmothers had Alzheimer's/dementia and were in care facilities for 15+ years. Also, I don't think all facilities accept Medicaid. If I have to be put in a facility, I would prefer it to be somewhere nice, and not have to bankrupt my family to pay for it. With any luck it will be wasted money.
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2003 CSi / Legend Ti / Seven 622 SLX |
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My experience in post above with my mother in law is in Florida. As you say, all facilities do not accept Medicaid, but my mother in law is in a place here in Central Florida that does.....along with private pay....and it's pretty nice......but not as nice where my mother was in NC....that was private pay only. BTW....I am not sure that "niceness" and fancy dining rooms, etc.....transfer over to quality of care. Had good luck with both kinds of places in that regard. Good luck with your journey ahead. I take care of making sure my mother in law's bills are paid.....and that she continues to qualify for Medicaid. it's a constant battle. My wife does most of the visiting, and that's a pretty steady thing. As has been said many times.....the sick and elderly get good care......but not much care for the care givers. |
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Awesome
Hope it works out for you OP, just wants to say that this is an awesome thread, I learned a bit here.
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Moved my mom into independent living a few years ago at her request. |
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Independent living, and then assisted living, in a retirement facility......is way less expensive than being in skilled care. If a person (or couple) can live mostly independently, then live with some assistance in the stage called assisted Living, the cost is about 1/2 of skilled care. Hopefully....private pay people can stay until the end in assisted living.....or almost to the end.
My mother and now my mother in law need more than assisted living. They needed skilled care. And most LT care policies won't pay anything until one needs help with some "activities of daily living" such as taking meds, eating, dressing, showering, toileting, etc. And that is usually skilled care. Last edited by Ralph; 04-26-2018 at 05:00 PM. |
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This thread should get stickied, not just for the personal financial advice but also for the scary realities of assisted living/ skilled care arrangements. The part about people eventually going on Medicaid for skilled care, just frightening. The country (and most of us) are nowhere ready to deal with the reality when the floor falls out for the social safety nets.
Before I socked away my first 15k into my 401(k) equivalent vehicle, I had already spent more on vehicles (by which I mean bikes). Many here can afford to do that, but looking back, that was an awfully dumb move on my part. Learn to live frugally, set personal finance goals and readjust those goals based on realities of life, and reward yourself with something nice after hitting said goals. That perhaps strikes a better balance. |
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in my experience with a grandparent staying in a care facility, it is a huge indignity of having to wipe out a life's savings, even if modest, then be "allowed" to keep a couple of hundred bucks or so (netted from social security or pension) to buy such luxuries like toilet paper....
obviously our family helps supplement a multitude of personal expenses out of pocket. yes i fully understand and appreciate there is an actual cost (and that cost, as described here in this thread, is HUGE) that has to be paid for a lot of services provided, and if one has assets then it is justifiable to use those assets to pay for the services. nothing is free. but the hoops one must go through to even get in a decent facility (and i'm not talking luxury), let alone eventually reaching the point where you're technically destitute financially and ward of the state....to me is absolutely demoralizing. elder care is such a huge topic and hits very close to home for our family. personally, i'd rather kick the bucket peacefully in my sleep at some point when i'm sorta old, rather than go into crippling old age in a nursing facility and wonder if someone's going to change my depends diapers. |
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