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How to Pay for Senior Living
20 Plays2 years ago
Older adults are making major life decisions, sometimes with limited information, creating indecisiveness or confusion. Join Erin DiCarlo and Joe Scott as they touch upon the various funding options available to pay for senior living.
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Transcript
Introduction to Engaging Aging
00:00:03
Speaker
Welcome to Engaging Aging with Erin and Lauren. Join us as we share laughter, tears, and demystify the realities and silver linings that occur later in life.
00:00:16
Speaker
Welcome to today's episode.
Introducing Joseph Scott
00:00:18
Speaker
This is Erin DiCarlo and I am joined by Joseph Scott, our Director of Move Management Services here at Dovetail Companies.
Navigating Assisted Living Costs
00:00:27
Speaker
Many people don't know Joe's background is many years in the financial services industry. I know that sounds very exciting. And what we'd love to address today is how in the world do people pay for this?
00:00:42
Speaker
We hear all the time when we start the process with our clients and their adult children or the older adult themselves says $8,000 a month for assisted living or even some independent living communities can be 10, $12,000 a month. How in the world do people pay for these services? And the answer to that is different for each person, but essentially,
00:01:10
Speaker
they planned for it.
Personal Motivation in Elder Care
00:01:11
Speaker
And if they did not plan for it, then we need to get creative to find ways to fund those needs later in life. And so with your experience personally and professionally, I'd love to pick your brain a little bit on some, maybe some examples you've seen, or how do you answer that question for people when they ask you? You know, it's interesting.
00:01:33
Speaker
I really wanted to get into this business or into this space when I moved my mom with my sisters into an assisted living community about, I don't know, 20 or so years ago. And I at that time was in financial services, you know, 25 years into my career and said, when I can retire, I want to do something in this space. And was fortunate to land and move management.
Misconceptions and Ageism
00:01:57
Speaker
I think the thing that I found most interesting is I was in financial services, as you said, and when I was leaving and telling my colleagues what it was that I was going to do,
00:02:12
Speaker
they immediately went to, oh, so you help, you move people into nursing homes. And I had, at that point, learned so much in the process of transitioning my mom way back when, and in talking with folks in the field, in the industry about sort of what can I do in this space, I learned that there's a whole lot more than just the nursing home. So I was really shocked that people
00:02:40
Speaker
very successful people who probably had a great financial plan weren't even aware of what their options were. Absolutely. And I think the underlying tone in these scenarios that we see all the time, we live in an ageist society. People don't talk about aging. They don't really plan for it. And so they don't know what the options are.
00:03:02
Speaker
They find themselves in a major life situation making really big decisions with limited information, which is worst case scenario. And the finances fall right into that.
00:03:12
Speaker
No, absolutely. And it's so
Financial Advisors' Role in Elder Care
00:03:14
Speaker
important. We talk all the time about the network of support that you have. And I mean, that's a podcast that could be, you know, multi, multi-episode episodes. But an important part of the support network is your financial advisor. And if you don't have one, it's really important to get one. And it's important to get one when you're in
00:03:36
Speaker
the stage in your career where you're building wealth because there's going to come a time when you're going to be depleting it and you need to understand what contributes to the depletion. You know, it's not only maybe medical costs or
00:03:52
Speaker
living options when you're retired or, you know, 20 years post-retirement. It's also the education that you're, you know, the money you're spending in education for your kids, the weddings, the vacation homes, and all of those things. So you can have a plan for, you know, for the future.
00:04:11
Speaker
So really important to have someone in your support. And making sure that that professional that you are working with is in alignment with the specific goals and needs. So I find it fascinating that a lot of the professionals that we work with aren't fully in one area or space. So I think about attorneys, right? There are these general practice attorneys that will write your trust.
Comparing Care Costs
00:04:35
Speaker
They also practice civil litigation and all of these different things.
00:04:39
Speaker
I think it's important to address, you have to be in alignment with experts in the aging space. So ensuring that your financial planner really understands what is the expense for home care. You know, if you wanted to live at home until end of life, what would it cost to adapt your home or to cover the cost for care? Or what is the difference between a purchase buy-in continuing care retirement community versus a rental memory care assisted living?
00:05:07
Speaker
I know your personal advisor has been a wonderful partner of yours through this process. He's been a great resource. And I was able to retire at 55 because of him. He understood what I wanted to do in post-early retirement. It was to be able to celebrate the success that I had, but also knowing that I wasn't going to build any more wealth,
00:05:35
Speaker
How do I best invest what I have so that I continue to grow that wealth so I can live a better retirement 20, 25 years? I couldn't have done it without a financial professional. And I think even if you have the support of a financial
00:05:52
Speaker
professional things can happen.
Learning from Others' Aging Plans
00:05:55
Speaker
And if you have someone who understands your finances and how your wealth can or cannot grow, what your access to that wealth is, it can make your ability to pivot during time of crisis much easier if you didn't have that financial person with a very specific plan for you who understood that things happen. Aging will happen. Aging happens, yeah.
00:06:21
Speaker
I think it's very interesting to point out as you're talking, I'm thinking about the lens in which you have viewed aging very much is comprised of your personal experiences.
00:06:33
Speaker
watching your mother go through the process of transitioning into assisted living and having a good experience with that versus the person who says to you, oh, you move people into nursing homes. No, that's not what I do because you didn't have that personal experience. And I think it's a gift when we do support the older adults in our life, we're able to see what those different experiences can be and then choose what we do or don't want for ourselves. When you look back at your experience through your mother or maybe grandparents or aunts and uncles,
00:07:01
Speaker
How has that influenced you in your planning or deciding what you want to see for yourself? It's really not as much my parents or aunts and uncles. I think it's, I look at, I'm seventh of eight children, so I have older siblings and I've seen the impact of not the best planning has on enjoying
00:07:32
Speaker
your mid to late 70s. And there's still a long time to live. But if they don't have a plan, if you don't have a plan, and that plan is not only just a financial plan, it's a it's an exercise eating right plan to write. So I think that the experiences that everyone has watching how
00:07:53
Speaker
your parents or your older siblings or your older neighbors, how are they living their life? And even asking them, how did you get here? You know, if they're in a place where you think, wow, I want to be like that when I'm 90 or 85, whatever that is, how did you get there? And I think you can learn a lot about it. I've learned more about
00:08:13
Speaker
the possibilities of living the best retirement life by working with our clients. And working with our clients on both ends of the spectrum, those that have planned really well and those who have not planned well. And equally, those two people, those two clients work just as hard.
Emotional and Practical Impact of Planning
00:08:32
Speaker
to make the money that they made, how they used that money and how they relied on professionals to help them really is the difference between living the best life and living really a sad, miserable life when you're 94. Yeah, I think you just hit the nail on the head. We had a recent client together where he worked really hard his entire life. Here he was now in his 90s with a wife with cognitive impairment.
00:09:00
Speaker
And it was hard enough to be in that situation of having to leave the long time home and support your wife with cognitive decline. But then to add the financial burden on top of that, which could have been avoided, is physically heart wrenching for you. I know it was for both of us to witness. In that example, this gentleman had a good job. He worked really hard. But he sent three sons to three very expensive Ivy League colleges
00:09:25
Speaker
versus investing those funds for future need. And now he really was stuck between a rock and a hard place and had to, you know, use every dollar from. Luckily in this real estate market, he had the equity from the sale of his home.
00:09:40
Speaker
which would ultimately allow them to be able to make this move happen. But there was a lot of stress for him. And I think they probably would have made the transition sooner if they had had a plan to meet the need. You did the math with him based on his savings and the equity that he had in his home.
00:10:00
Speaker
you know, they could afford a modest assisted living community, a nice one, modest one bedroom apartment and one, and I think that gave him a lot of comfort and relief and it was a shame that it took
00:10:13
Speaker
to 94 to get that. And I always say, I feel so badly for those clients because I feel like they mourn what they no longer have. They mourn the fact that they're not building wealth. Yes, he had a great career as an engineer for all those years. He mourns the end of his career and doesn't spend
00:10:34
Speaker
you know, the remaining years of his life celebrating himself and the pride that he had in accomplishing all of that. Conversely, when we see clients all the time who are very successful in having a great financial plan and move to a beautiful continuing care retirement community, and it's one of, you know, two of their homes that they have.
00:10:54
Speaker
And they probably worked just as hard as that other gentleman did. But they had a better plan. And to see them not mourn the end of a career and be able to be excited about the next step. They were excited. They were celebrating. And with that comes a lot of pride in living, really living your best life. It's so interesting. When you talk about pride, I think oftentimes people are
Resources and Seeking Help
00:11:20
Speaker
not sharing their concerns or reaching out for help.
00:11:24
Speaker
thinking that they're preserving their dignity and keeping their pride and saving face where it's actually doing the opposite. And when to reach out. There's a lot of different resources for older adults when it comes to funding. There's a veteran benefit for, it's called the Veterans Aid and Attendance Benefit. It's for older adults who served during a war time.
00:11:45
Speaker
that either have a cognitive impairment themselves or their surviving spouse, or if they're needing assistance with two or more activities of daily living. It's a wonderful monthly income to help cover the cost for care. People don't know about that. There's some really interesting life insurance products that are coming into the market.
00:12:04
Speaker
If you don't have long-term care insurance, you can tell your adult children if it's too late for you about some other funding options. If you had known to ask for some support or help earlier on, there are some resources and things that you can do to plan.
Discussing Finances with Family
00:12:18
Speaker
Even if you don't have a really long runway for planning, there's still a way to become kind of creative and look at different avenues. And I think we don't want to cut our noses despite our faces in these scenarios.
00:12:32
Speaker
Also, a lot of adult children may not be aware if your parents have a financial plan and you may be wondering and you may be concerned. So my advice, the best way to open the door to that conversation to find out where they are at. It is not uncommon, by the way, for this generation not to have a professional in place.
00:12:51
Speaker
I married both of my in-laws or first-generation immigrants to America and they were in a cash business. Hair salon owners. And there was a lot of cash. There wasn't investments, traditional investments. And for pride, they may not have shared this information with children.
00:13:11
Speaker
lead by example. Maybe you talk about that you just met with a financial planner to figure out your plan for the future and you are really fascinated to find out all the resources that were available. What about you, mom or dad? Have you met with one before? And get a financial planner who has a holistic view of your
00:13:30
Speaker
experience and
Aligning Plans with Goals
00:13:31
Speaker
what you want it to be. When we go into a meeting and talk to a client about moving, we always say, what do you envision this to be? How do you want it to go? How do you want your retirement to be? And I think the best financial, the best question that I got asked as my advisor from Commonwealth Financial Group asked me very specifically, what does it look like for you? And it looks like I'm gonna stop working early to do something that I feel passionate about.
00:13:57
Speaker
How lucky are we that this is the passion we got you here without planning a dovetail? No, but if I didn't, if he didn't ask that question and just sort of thought of me as, you know, ex age, and you're probably going to live to this, you need this to like, you're going to work to this. No, it was
00:14:15
Speaker
you have a very specific plan for yourself, how can I help support that with the right financial plan? And the thing is, it's my business, right? I can go in and talk to a financial planner and I don't have adult children, but our clients that do, just go and do it and get armed with all the information that you can get armed with and have someone help you with the plan.
00:14:38
Speaker
You're not, number one, putting yourself in a really bad position, but you're not putting your adult children in a really bad position as well. Yeah, you're maintaining your autonomy. You are your own decision maker. You are at the helm of the ship and deciding where it's going to go. I think we see far too often in elder care specifically this cookie cutter planning approach. I can't tell you how many clients through the years
00:15:00
Speaker
You know, they heard that those scary nursing home advertisements on the radio or the television save your house from the nursing home. They're referring to Medicaid planning.
00:15:11
Speaker
and keeping your assets in your home out of the state's hands through Medicaid planning. But what that planning does is it puts you in a nursing home on the state's dime. I've yet to meet someone whose goal and plan is to end up in a nursing home on the state's dime. So in order to maybe afford private care at home or one of these nicer, you know, senior living communities, you're actually maybe going to need to have access to
00:15:37
Speaker
the equity in your home, and that type of planning wouldn't meet that goal. So I think it is so important to make sure when you're sitting down to talk to a potential financial planner, they should be starting the conversation the way yours did at Commonwealth Financial with you. What are your goals? And then your plan gets backed in to meet your goals. If you're meeting with any professional that's starting with a plan before they get to know your goals, it's really backwards.
00:16:05
Speaker
Any other parts of it? I know you've helped older family members through this process and it's not so easy. Maybe discussing what works for you may not work for everyone. Everyone responds different to planning? Everyone is different and responds to planning differently and responds to input differently. Sometimes there's embarrassment because they didn't have it. Sometimes
00:16:27
Speaker
there is embarrassment because they don't understand it and they don't want you to think that they sort of are not in control or don't have the wherewithal to make those kinds of decisions. So you have to be soft in the approach and offer solutions or suggestions that say it could be easier for you if.
00:16:50
Speaker
And I can say with the experience that I have, I've seen people who haven't and it's a really horrible ending for them, right, that they end up in a place where they don't know where their next great adventure is going to be in life when they have that plan. So it's, you just really have to handle the conversation really gingerly, but
00:17:15
Speaker
know
Conclusion and Contact Information
00:17:16
Speaker
that they come from a place of always wanting to have done the right thing for themselves and for their families. And yes, that may have put them in the position they're in now. That's probably not the greatest. But respect that and just sort of help them live their best life now. Yeah. Well, thank you for joining us today and giving us some pearls of wisdom. And hopefully we all have the financial ground under us to do what we want and live the best life possible. Yeah, thanks. Thanks, Joe.
00:17:47
Speaker
Thank you for joining us today. To continue the conversation, follow us on social media at Dovetail Companies or visit us online at dovetailcompanies.com. And remember, change can be difficult if aging doesn't have to be.