How Will You Afford a Long Life?
Living into your eighties is no longer uncommon. With the doubling of life expectancy since the Industrial Revolution, we have achieved what the New York Times has described as the "greatest miracle in the history of our species." Today the average life expectancy is nearly 80 years. According to the data compiled by the Social Security Administration, a 65 year old male today can expect to live nearly two more decades until age 84, while a 65 year old woman can expect to live until age 87 (and those are just the averages). One out of every four 65 year old adults will live past age 90 and one out of ten will live past age 95.
With this longevity comes new challenges in particular, how to pay for the long term care that may be needed. One of the greatest financial risks - and the most ignored - is living so long that you run out of savings before you die or leave little to nothing for your spouse or children. With the average cost of a nursing home in Michigan nearly $9,000.00 per month, can you afford just the first 12 months (i.e. over $100,000.00)? What if your nursing home stay extends beyond one year? What about in-home care which can be even more expensive? Can you afford $200,000.00 to $300,000.00 in long term care expenses?
No one can be certain whether long term care will be needed. However, the longer you live, the greater chance you have of needing long term care. The statistics regarding the potential need for long term care are sobering:
More than 70% of Americans over the age of 65 will need long term care at some point (Wall Street Journal; "Should You Purchase Long-Term Care Insurance?"; May 14, 2012).
One out of every three seniors will die with Alzheimer's or another type of dementia (2018 Alzheimer's Association Facts and Figures).
Nearly 50% of persons over 85 are affected by Alzheimer's (2018 Alzheimer's Association Facts and Figures).
Over 50% of persons entering a long term care facility are broke within 12 months (Harvard University).
Fortunately, you don't have to bury your head in the sand. With proper planning, you can protect yourself and your loved ones. There are financial and legal strategies available to help ensure that our long term care needs can be met if such care should be required. Be sure to consult with an experienced elder law attorney to discuss your options. Don't wait until it's too late!
This blog post is written by Brett A. Howell, Certified Elder Law Attorney. The blog is written as a service of The Elder and Estate Planning Law Firm, P.L.L.C. This information is for general informational purposes only and does not constitute legal advice. For a consultation to address specific questions, please call (810) 953-3846.