The Finance Of Longevity

Crisis, Caring & A Long-View For Long-Term Care

COVID19 is giving way to thinking about a long term solution to eldercare

A new study from Saturday Insurance shows nearly half of young adults likely to pursue options to assist their parents. Access the full study here.

As eldercare has become top of mind for many Americans during the Coronavirus crisis, a new survey conducted by PSB Research for Saturday Insurance, finds Americans are increasingly considering long-term care options for their parents. Forty-nine percent of those between 25 and 34 years old report that they have been more likely to research this topic during their recent weeks at home.

The report comes as celebrities, government officials and legions of Americans have reported the challenges they have faced making certain their older parents have food and supplies while keeping a safe distance and providing the emotional support needed for those who are older and live by themselves.

New York Governor Andrew Cuomo cited his own mother when he enacted, “Matilda’s Law,” which includes numerous social distancing restrictions.

“My mother, who lives alone, everyone wants to help and we have gone back and forth,” he has said. “Should we visit mom? Should mom go to my sister’s house? Should she go to this house? Nobody knows for sure.”

 

Via Instagram, Lady Gaga wrote, “I wish I could see my parents and grandmas now, but it’s much safer to not, so I don’t get them sick.”

Comedian Amy Schumer sent a “we love you” message to her father via a sign outside his Manhattan home.

Americans are seeking answers to the following questions, per the data:

  • What type of care will I or my parents need? (37%)
  • Who should advise me on care options and how to pay for them? (33%)
  • How does long-term care insurance work? (31%)
  • How are we going to pay for long-term care? Does Medicare cover nursing home costs? (26%)

“Our customers are signaling that long-term care planning is a priority” said Dennis Ho, CEO of Saturday Insurance. “We’ve seen a marked increase in calls from those concerned about their parents and fielded more requests for long-term care insurance advice in the past month than ever before.”

The data also indicates that 46% of 25-34-year-olds have considered buying or reviewing life or disability insurance during the past month and 55% of that age group have investigated long-range financial planning. Sixty-three percent are reviewing their spending and budgeting.

It also shows that Americans are watching more television, cleaning and organizing their homes, exercising, working and doing yard work.

Excerpts from the study ‘The Real Reasons Why People Buy LTCi’

Reason 1: I don’t want my care to become a burden to my family.
The reality is 70 percent of us will need some type of long-term care after age 65. The level of care ranges from in-home assistance to assisted living facilities to nursing home care. On average, people need long-term care for three years, with women needing care an average of 3.7 years, compared with men who average 2.2 years. One in five people needs long-term care for five or more years.

Most of us want to stay in our homes as we age. But doing so can put a strain on our caregivers. Today, 80 percent of care in the home is provided by unpaid caregivers, usually family members, who spend an average of 20 hours per week providing care. Two-thirds are women, with many also balancing a job and childcare responsibilities. Along with emotional strain, there’s also a financial impact. It’s estimated caregivers lose an average of $303,880 in wages and benefits over their lifetime.

While Medicaid provides a safety net once your savings are depleted, its primary focus is on nursing home care. Depending on your state, Medicaid doesn’t always cover home-based care or assisted living options...

Reason 2: I want to ensure I save what I’ll need for retirement – and protect my hard-earned assets.
Many people plan to rely on their retirement savings to cover the costs of long-term care. But it can be difficult to determine how much savings you’ll need.

Sixty-three percent of people don’t have any out-of-pocket long-term care expenses in their lifetime due to a combination of unpaid caregivers, insurance coverages and Medicare or Medicaid benefits. However, when you do need long-term care, it can be expensive. The costs vary significantly across the country, but the median annual cost for assisted living care is $48,612. The cost of nursing home care is more than double that, with the nationwide median at $102,200 per year. The median annual cost for home health aides is in the middle at $52,624.

A couple I work with are planning their retirement. The husband is 61, and the wife is 57. They’re at the point where they’re figuring out more of the specifics, such as how much money they need to live on and when they will start drawing on their retirement savings. One of their biggest concerns is what would happen if one of them had a significant health crisis, requiring extensive care that would eat up the substantial nest egg they spent their lifetime building, leaving the other spouse with much less to live on in retirement.

Reason 3: I want to ensure I have choices when it comes to my care.
Even though it’s not something we like to think about, most of us have a clear idea of the type of care we’d like as we grow older. Planning for long-term care starts with making your preferences known and creating a financial plan to achieve them.

While Medicaid provides a safety net once your savings are depleted, its primary focus is on nursing home care. Depending on your state, Medicaid doesn’t always cover home-based care or assisted living options. When it comes to nursing home care, it’s not always easy to find a bed as a Medicaid resident. Even though up to 90 percent of nursing homes accept Medicaid, the percentage can be misleading. Nursing homes may only take a set number of Medicaid residents, so your choice of facilities may be limited.

Long-term care insurance can help ensure you’re able to pay for the level of care you need and want. One solution may be to supplement your savings with insurance. Here’s a process to determine how much, if any, long-term care insurance you might need.

Download the full survey here.

 

 

 

 

 

Survey Methodology
PSB Research conducted an online, quantitative survey among 1,000 members of the U.S. general population over the age of 18. Research was conducted on April 2, 2020. The sample is representative of the U.S. national population, per the U.S. Census. The margin of era for this study is +/- 3.10%.
About Saturday Insurance
Saturday Insurance is an online independent insurance agency founded by long-time insurance executives, CEO Dennis Ho and COO Chris Cheng, based on their passionate belief that having the right insurance helps people live happier lives. Their mission is to make insurance simple, transparent and affordable for all. They designed the Saturday Insurance experience to be different, with no commissioned agents, transparency throughout the purchase process, and personalized, unbiased advice from experts. It is a modern, independent agency that is redefining the experience of choosing the right protection for one’s family. Saturday Insurance is licensed in all 50 states and the District of Columbia. CEO Dennis Ho has authored financial articles for Kiplinger, the HumbleDollar and Advisor Magazine, among others. Visit Saturday Insurance here.