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Freedom News

Eldercare Financial Planning – What You May Not Know Can Cost You!

Allow me to immediately put forth a disclaimer that I have absolutely NO financial background whatsoever!  I have enough trouble balancing my checkbook – and yes, I still actually use a checkbook.

That being said, it is rare that as an advocate and care coordinator for the elderly, I have an “aaha!” moment.  I recently met with an insurance specialist who is offering a product to seniors and their families that I had never thought about previously.

For many years, I have been a strong supporter of Long Term Care insurance. I have personally witnessed the financial devastation of a chronic disease or dementia can cause for a client and the family. (www.longtermcare.gov )   I have long term care insurance, my husband has it and even our parents had it (and two of four used it!) I used to encourage my clients to cash in their life insurances policies and convert them to Long Term Care Insurance policies.

The news now is that many insurance companies are getting out as fast as they can from promoting this product as the actuaries and the onset of the baby boomer cohorts turning 65 is sending them scared of the losses.  For sure, we will see much more costly policies, making it less affordable for the average boomer.

Last week, I met with two gentlemen who buy life insurance policies at 50% of their face value.  I believe this kind of program can provide a simple, financially-prudent and dignified way to fund senior care.

They can help individuals who seek various  senior care services (such as home care, residential and long term care facilities, etc) use life insurance policies they no longer want, can no longer afford or have been forced to abandon into a valuable asset for them and their families. (www.eldercarefinancialsolutions.com )

So many of the elderly clients I meet with don’t even remember that they have one or more policies gathering dust in their files.  Their original need for it (to assure mortgage payment in case of death, college tuition for the kids, weddings, grandchildren’s trusts, etc) no longer exist yet they find themselves cash poor for the services they need with chronicillness. (www.payingforseniorcare.org )

While I have also been a supporter of reverse mortgages in dire need of cash, there is tremendous resistance, confusion and suspicion about these by the consumer.  I have never quite understood it, but it does exist.  Other than a parent wanting to be assured of a gift to children after death, I can’t see a  reason why one would not be interested in pursuing this option.

Check the following websites to gain more knowledge of those who deal with financial planning for the elderly:

www.naela.org (National Assoc. of Eldercare Attorneys)
www.napgcm.org (National Association of Professional Geriatric Care Managers)

~ Barbra London, MSW, LCSW, LNHA