Cost of Care vs. Access to Care

During my years as a financial planner I would often hear people in retirement say that they had already planned for the latter stages of retirement because they had purchased long-term care insurance. In fact, there was a time when I, too, felt that owning long-term care insurance was a plan. Long-term care insurance can protect a lifetime of hard-earned savings from being depleted by the exorbitant costs of extended, long-term care services. It can also help you avoid liquidating your assets and relying on Medicaid for support. Yet, after spending the last few years researching the retirement livingand senior care industry I now realize that long-term care insurance is only part of a much broader plan that addresses not only the cost of care but also access to care.

Phases of Retirement Planning

According to Bernard Krooks, a lawyer specializing in elder law, there are five phases of retirement planning. Phase IV (“mid-retirement”) “begins at age seventy and lasts as long as you are able-bodied and high-functioning.” At this phase, Krooks advises, “Despite your good health, begin looking at what steps you would like your family to take should your condition decline significantly.” (, February 2011).

Krooks says Phase V (“late-retirement”) occurs “when our health has taken a turn for the worse and there is little likelihood of it being fully restored. You require significant help to function day to day. The hope is that by this point all the planning done in prior years makes this transition as manageable and life-affirming as possible.”

Plan Now

If you are approaching, or are in, “mid-retirement” now is the time to plan for your latter retirement years, while you are still active and able. The planning process should not be limited purely to an analysis of how to pay for care. An equally important aspect of the planning process is to carefully consider where you will live and the availability of long-term care services. Even if you plan to stay in your home you should consider who will manage the process of arranging and overseeing care on your behalf. What if eventually the level of care you require can no longer adequately be provided in your home? Postponing decisions about your future care needs often defers the task to adult children or other family members who, operating in “crisis-management mode,” may not have the resources, flexible schedule, or emotional capacity to take on this responsibility.

Invest in your future by learning about each your retirement living options today. Consider each of the options—from living in your home to moving to a retirement community—and the potential implications of each choice over time.

There is no “right” answer. What is most important is that you take the time to learn about the various options so you can make an informed decision for your unique situation.

To learn more about the various retirement living and care alternatives order your copy of “What’s the Deal with Retirement Communities” today.

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