The Talk
I have written in past blog posts about how best to approach the topic of long term care with a parent or elderly loved one. There are no two situations that are exactly alike so there is no one best way to handle the delicate subject. It is especially difficult when the senior is resistant to making a change or to even acknowledging that he/she needs some assistance and is living in an unsafe environment. It is hard to imagine a worse outcome however, than the one that occurred last month in Arizona. According to various media reports a 92 year old Arizona women allegedly shot her son when he tried to place her in an assisted living facility. Police responding to the scene found Son dead on the floor as a result of a gunshot wound and Mom in a chair muttering, “You took my life, so I’m taking yours”. She then told the police that she killed her son because he wanted to put her in a facility. We don’t have a complete record of what events and conversations transpired leading up to this tragic outcome. It appears that Mom had moved into Son’s house only months
Buzz Aldrin’s Legal Fight
As the population ages so do our celebrities who face many of the same elder related legal issues as the rest of us. Buzz Aldrin is yet another example of this. His story caught my attention last month. Aldrin, a local guy, was born and raised in Montclair, New Jersey and is known along with Neil Armstrong as the first men to walk on the moon. July 20, 1969 is a date etched in American history. It is one of the first memories I have of an historic event which I personally witnessed. Aldrin is now 88 years old and living in Florida. 2 of his 3 children have asked a Florida court to appoint them to be his co-guardians, citing his cognitive decline, paranoia and confusion as reasons. Andrew and Janice Aldrin say they want to manage his finances and his businesses. They say he is being manipulated by people he is unfamiliar with. Aldrin, for his part, says that he is unquestionably competent and does not need a guardian. He has filed a suit against his children and his business manager alleging elder exploitation. As with most of these types of lawsuits it comes down to money.
What Medicaid Covers – Part 2
In last week’s post I was telling you about a call I received revealing a very common misconception about Medicaid. Julie will lose her alimony payments in 6 months, dropping her income from $5000 per month down to $1000 per month. She is 69 years old and in good health. She does not need any long term care at this time. The reason for her call was to ask me about applying for Medicaid. Her thought is that Medicaid could replace her income. It’s that thought that is so common and also so wrong. That’s because the Medicaid program does not provide income. It also does not provide any money directly to a recipient. Instead, it is an insurance program that pays the cost of medical and long term care – depending on which program a recipient is eligible for. In some cases, people become eligible for Medicaid because they are also eligible for SSI. Supplemental Security Income does provide income to certain low income disabled individuals. They also get Medicaid health insurance coverage when they start receiving SSI payments. In Julie’s case, however, she won’t qualify for SSI. She already gets a
What Medicaid Covers – Part 1
The call we received last week raised a common misunderstanding about Medicaid. Julie called regarding getting Medicaid benefits. Julie is 69 and in relatively good health for her age. She is selling her home and will be moving to a rental unit in a senior housing complex.
Julie expects to sell her home and net $200,000 after paying off a $250,000 balance on her mortgage. She has another $200,000 of savings. Julie also has a long term care insurance policy that pays as much as $300 a day for long term care in a nursing home, assisted living facility or care at home for 3 years. She also has income of $1000 per month from Social Security and she receives $4000 per month of alimony from her ex-husband.
So why is Julie asking about Medicaid? It appears that $5000 of income per month is enough to support her lifestyle. Julie is concerned because her alimony payments will terminate in 6 months and she is looking to replace the $4000 of alimony income that she will lose. With only $1000 a month of income, Julie will need to dip into her savings to meet her monthly expenses. Julie figured that Medicaid could help plug that gap.
Counting on Inheritance to Pay for Retirement
A recent study of affluent children between the ages of 18 and 22 caught my eye. The study reported that 63% of 1000 people surveyed in this age group said they believe their financial security in retirement will depend in part on inherited money. Granted, most of the people in this age group are still in college. Very few are yet in the working world and in the midst of their careers so maybe their fears are not yet warranted. But, the survey focused on the “mass affluent”. For the age group of 18 to 40 that is defined as someone with investable assets between $50,000 and $250,000 or investable assets between $20,000 and $50,000 with annual income of at least $50,000. What I find quite interesting is that of the 18-22 year old age group, many believe the inheritance will come from someone other than their parents. 17 percent think it will come from friends or from grandparents. Another 14% think other family members will leave them something. Much has been written about how the children of baby boomers will be the first generation less well off than their parents. There are many
Update on Social Security and Medicare
The federal government has issued annual updates on the financial soundness of Social Security and Medicare, stating that each government benefit program will run out of money within the next 8 to 16 years or so. Here’s the latest news. For the first time since 1982 the Social Security program’s costs will exceed its income, requiring the use of funds from the program’s $3 trillion trust fund to cover the shortfall. This is happening 3 years earlier than was predicted at the time of last year’s report. The trust fund has grown to its current size in part because there has been more money collected than has been paid out. The excess funds have been added to the trust fund. That may be nearing an end. There are several causes for this. Certainly demographics plays a role. The population continues to age which means there are fewer people paying into Social Security and Medicare via payroll deductions from wages while at the same time there are more people applying for benefits and living longer while receiving those benefits. Last year there were 2.8 workers for every Social Security recipient. 10 years before that