running against the clock to save enough money for retirement

How to Save for Retirement – 6 Great Tips

Just because you haven’t saved for senior living doesn’t mean you can’t afford it. Here are 6 tips to bolster your savings quickly.

6 Quick Tips on Saving for Retirement

Are you nearing retirement, but aren’t completely prepared financially? You’re not alone. According to GoBanking, 3 out of 10 baby boomers aged 55 and above have no retirement savings. What’s more, 26 percent of those who were able to put money aside say they have less than $50,000 saved. You may feel this limits your options, particularly for active senior living, but that’s not necessarily the case. Here are some ways you can bolster your savings quickly.  

The Cost of Active Senior Living

You won’t know how much you need to save for retirement unless you know the cost of senior living, so let’s start there. Senior living is an umbrella term which includes several levels of care. Active senior living (or independent living) is the entry point in this continuum, which also includes assisted living, skilled nursing, and memory care.

Active senior living is designed for residents who need little daily assistance but seek less responsibility and a range of social and enrichment opportunities. Although there is little published data on senior living average cost because it varies so greatly; it typically ranges from $1,000 to $4,000 a month. Keep in mind this cost includes meals, weekly housekeeping and laundry services, as well as access to a range of activities and amenities such as fitness center and pool.

What Can Affect the Cost of Senior Living

  • Level of Care – Essentially more assistance means more expense. Many seniors opt for a community that offers multiple levels of care on one campus so you’ll pay less now but have the peace of mind that a higher level of care is available if needed.
  • Geography – Where you live affects the cost of senior living just like real estate. To keep costs down you might consider active senior living communities outside the city or even a different state.
  • Amenities – The more luxury, the higher the cost as well. Options that impact cost include type of residence (private, semi-private, studio, one- or two-bedroom), pet fees, concierge services, and private transportation.

Know Where You Stand

You may have more resources at your disposal than you realize to pay for active senior living. Knowing where you stand starts with organizing your financial documents including:

  • Bank and brokerage account information
  • Deeds and mortgage documents
  • Insurance policies
  • Monthly or outstanding bills
  • Pension and other retirement benefits
  • Social Security payment information
  • Stock and bond certificates

Then, consider consulting a financial advisor and/or estate planning attorney to discuss how you might be able to maximize these resources for active senior living:

  • Insurance options including long-term care insurance and/or life insurance conversions
  • Pension, Social Security benefits and personal property such as your home
  • Potential tax deductions
  • Your investment portfolio

Best Ways to Save for Retirement

If you do have a gap between your current resources and what you expect to spend on active senior living, these tips can help you save for retirement:

  1. Catch-Up on Contributions – Starting at age 50 you can make extra contributions to your IRA and 401(k) accounts. The extra amount is now up to $6,500 for 401(k)s and $1,000 for IRAs according to the IRS.
  2. Consider a Health Savings Account – To help you prepare for unexpected medical expenses and reduce your taxable income you could open a health savings account. What you save will grow tax-free, and when you turn 65 you can start making withdrawals for qualified medical expenses.
  3. Wait on Social Security – Although you can technically collect benefits starting at age 62, most financial advisors recommend waiting. The reason? Drawing at 70 instead of 62 can increase your monthly benefit exponentially.
  4. Start a Side Hustle – According to Merrill Lynch and Age Wave, 47 percent of baby boomers today enjoy working in retirement. Beyond earning extra income, it also helps you stay active and maintain a sense of purpose. You could freelance or do consulting work depending on your skillset, or even try something completely new.
  5. Change Spending Habits – Take a look at where/how you spend your money to see where you can cut. Perhaps switch to a pay-as-you-go cell phone, opt for streaming services versus expensive cable, or even (gasp) limit those trips to Starbucks.
  6. Check for Benefits – See what benefits in which you may qualify. There’s the Veterans Aid & Attendance benefit for wartime veterans or a surviving spouse. Also, the National Council on Aging’s benefitscheckup.org website makes it easy to check thousands of state and local programs. 

Bonus Tip: Compare Your Costs at Home

You may think active senior living will cost you more, but when you compare it to the total cost of living at home, in some cases it can be less! How? The cost at home is more than just mortgage or rent, it also includes food, entertainment, and home upkeep, all of which are included in active senior living. Some utilities may be included too for extra value!

For additional help in saving for active senior living, check out our Financial Planning for Senior Living Guide today!

Why Many Fail to Plan Correctly For Retirement

How to Retire without the Worry

The retirement years, once a time to look forward to is now all too often filled with trepidation and worry. Have I saved enough? How can I predict healthcare expenses? Will I really be able to retire? Will my lifestyle have to change? Should I downsize? These are important questions and it’s understandable you’d be concerned with all the unknowns. However, proper planning can help ease these worries so you can start enjoying retirement again. Here’s how.

Retirement Realities

One of the best things you can do is to educate yourself on what to expect. In general, you’ll need to replace approximately 70 to 90 percent of your pre-retirement income to maintain the same standard of living. That range depends on where you live and when you choose to retire among other factors.

Based on Bureau of Labor Statistics data, Americans 65 and older spend an average of $45,756 per year or around $3,800 a month. In addition, Fidelity reports that a 65-year-old couple retiring in 2019 could expect to spend $285,000 on healthcare costs during retirement.

Also, don’t assume if and when you do need long-term care that Medicare, Medicaid and/or your health insurance will cover it. In general:

  • Medicare only pays for long-term care if you require skilled services or rehabilitative care and only for a short period of time.
  • Medicaid does pay for the largest share of long-term care services, but to qualify, your income must be below a certain level and you must meet minimum state eligibility requirements.
  • Health Insurance through employers or private health insurance typically cover only the same kinds of limited services as Medicare.

Making Sure You’re Prepared

Don’t start to hyperventilate just yet. Keep in mind that you need an idea of what to expect in order to know how best to prepare. And rest-assured, you may have more resources at your disposal than you realize. To get started, organize your financial documents including:

  • Bank and brokerage account information
  • Deeds and mortgage papers
  • Insurance policies
  • Monthly or outstanding bills
  • Pension and other retirement benefit s
  • Social Security payment information
  • Stock and bond certificates

Then, consider consulting a financial advisor and/or estate planning attorney to discuss ways in which you might be able to maximize these resources in retirement:

  • Insurance options including long-term care insurance and/or life insurance conversions
  • Pension, Social Security benefits and personal property such as your home
  • Programs in which you may be eligible like the Veterans Aid & Attendance benefit
  • Potential tax deductions
  • Savings as well as your investment portfolio

Home Versus an Over 55 Community

The price tag of senior living may give you a bit of sticker shock initially, yet when you look a little deeper into the value that’s included within those monthly numbers, in some cases it can be less than aging at home!

One of the next big questions is whether or not to downsize as housing is one of your largest monthly expenses in retirement. Most people assume that staying home is the most cost-efficient way to go but that’s not always the case. Let’s compare.

An over 55 community is what’s commonly known as independent living. This type of community falls under the umbrella term senior living; however, it’s the entry point in a continuum of care that also includes assisted living, skilled nursing and memory care.

These communities are designed for active retirees like you who need little daily assistance. While there is little published data on average cost because it varies so greatly; it typically ranges from $1,000 to $4,000 a month. Keep in mind this cost comes with meals, weekly housekeeping, laundry services and transportation often included, as well as access to a range of activities and amenities such as fitness center and pool.

At home, you may think your mortgage or rent is what you’re comparing. But that’s a costly mistake. Your total cost of living at home each month also includes food, entertainment and home upkeep. These costs are typically included in the monthly cost of over 55 communities that you see above. In many cases, at least some utilities are included as well.

What also comes with life in an over 55 community? Predictable expenses, a worry-free lifestyle and perks like a monthly calendar filled with clubs, classes, events and outings that you may not have access to at home. But what’s truly invaluable is the peace of mind that comes with knowing you’ll have support if and when you need it as many of these communities offer other levels of care on the same campus.

For additional help in getting financially prepared for retirement in an over 55 community, check out our Family Guide to Funding Senior Care & Housing today.

Getting Financially Prepared For Retirement Living

Retirement living comes with big benefits, but many believe it also comes with a price tag so big they can’t afford it. In reality, retirement living may be well within reach for you or your loved one once you compare it to the true cost of living at home, and learn the funding options available to help offset the cost. Let’s take a look.

The Cost of Retirement Communities

Senior living is actually an umbrella term for a continuum of care. As such, the cost is closely tied to the level of care that you may need. Types of care on the continuum include:

Independent Living – This type of senior living is less about care and more about lifestyle because it’s designed for active seniors who need little daily assistance and want carefree living with a range of social opportunities. Although there is little published data on the average cost of independent living it is typically less than other types of senior living; ranging from $1,000 to $4,000 a month.

Assisted Living – Consider this the next step in the continuum with onsite care, 24-hour supervision and support with daily activities provided. Plus, you’ll still enjoy amenities and social opportunities similar to independent living. According to the most recent Genworth Cost of Care Survey, a private, one-bedroom apartment costs $4,000 per month on average.

Memory Care – Here you’ll find an environment specifically designed those with Alzheimer’s disease and dementia that includes 24/7 support, structured activities and specially-trained staff. There is also little published data on average costs for memory care because it varies so greatly, however costs typically ranges from $2,000 to $7,000 a month.

Skilled Nursing – This type of senior living is what you might consider the highest level of care on the continuum with 24/7 nursing as well as physical, speech and occupational therapists onsite. According to the most recent Genworth Cost of Care Survey, a semi-private room is $7,441 and a private room is $8,365 a month on average.

Senior Living versus Aging at Home

The price tag of senior living may give you a bit of sticker shock initially, yet when you look a little deeper into the value that’s included within those monthly numbers, in some cases it can be less than aging at home!

While you may be comparing the monthly cost of senior living to the cost of your mortgage or rent, keep in mind your total cost of living at home each month also includes food, entertainment and home upkeep. These costs are typically included in the monthly cost of senior living that you see above. In many cases, at least some utilities are included as well.

Not to mention extras like beautiful campuses, spacious accommodations and amenities such as a pool, fitness center, housekeeping and laundry services as well as a monthly calendar filled with clubs, classes, events and outings that you may not have access to at home. But what’s truly invaluable is the peace of mind that comes with knowing you’ll always have care and support, if and when you need it.

Funding Options for Retirement Living

As you prepare financially for retirement living, it’s important to understand the options available that may be able to help you offset the cost including:
Veterans Aid & Attendance Benefit – Wartime veterans or a surviving spouse may be eligible to receive a non-service connected pension (above the basic pension) to assist in paying for assisted living, home health care, adult day care or skilled nursing if you meet certain conditions.

Long-Term Care (LTC) Insurance – LTC insurance can help pay for the cost of home health care, adult day care, assisted living, memory care, skilled nursing and hospice by covering services typically not covered by health insurance, Medicare or Medicaid.

Life Insurance Conversion – You may be able to convert an in-force life insurance policy into a pre-funded financial account that disburses a monthly benefit to help pay for needs such as home health care, assisted living, skilled nursing and hospice.

Reverse Mortgage – In this type of home equity loan, homeowners 62 or older can access their equity to supplement retirement income. The lender will make payments to you based on a percentage of your accumulated equity.

Your Current Assets Can Also Help

Last, but certainly not least, look at the resources you may already have available. Consider selling or renting your home, for example. Do you have savings, stocks, bonds or annuities? What about income such as Social Security or a pension? Any or all of these can also help make retirement more affordable.

For additional help in getting financially prepared for retirement living, check out our Family Guide to Funding Senior Care & Housing today.

Tips on Paying for Retirement Living in Over 55 Communities

Author Alfred Montapert once said, “Your life will be no better than the plans you make and the action you take.” We think this sentiment is particularly true when it comes to retirement. When you’re young you may feel like life is predetermined: school, work, family and so on. So it may initially feel freeing to wing retirement, but you may be shortchanging yourself. Proper financial planning can actually open up more options for the retirement you want in an over 55 community.

What’s Your Goal
First, ask yourself what your dream retirement looks like. If it includes relaxation, fun, amenities and a carefree lifestyle then it sounds like retirement living could be an ideal fit. But, don’t let the initial sticker shock of an over 55 community deter you. That’s exactly where the planning part comes in; to help put retirement living well within reach.

Start by Taking Stock

To prepare financially for retirement living, start by organizing your financial documents including:

  • Bank and brokerage account information
  • Deeds and mortgage papers
  • Insurance policies
  • Monthly or outstanding bills
  • Pension and other retirement benefit s
  • Social Security payment information
  • Stock and bond certificates

Then, consider consulting a financial advisor and/or estate planning attorney to discuss ways in which you might be able to offset the cost with resources already at your disposal such as:

  • Insurance options including long-term care insurance and/or life insurance conversions
  • Pension, Social Security benefits and personal property like your home that may be potential income
  • Programs in which you may be eligible like the Aid & Attendance benefit for veterans or their surviving spouses
  • Potential tax deductions
  • Analyzing your savings as well as your investment portfolio with long-term needs in mind

What to Expect

Retirement living (also known as independent living) falls under the umbrella term senior living; however you might say it’s the entry point in a continuum of care that also includes assisted living, skilled nursing and memory care.

Retirement living is designed for active seniors like you who need little daily assistance and although there is little published data on average cost because it varies so greatly; it typically ranges from $1,000 to $4,000 a month. Keep in mind this costs comes with meals, weekly housekeeping, laundry services and transportation often included, as well as access to a range of activities and amenities such as fitness center and pool.

More for Your Money

Now that you know where you stand financially and in general what to expect in retirement living costs, let’s look for ways to make your hard-earned dollars go further. It’s important to understand that there are three main factors that affect the cost you’ll pay:

  1. Level of Care – Essentially the more assistance you need, the higher the cost. You might consider a community that offers multiple levels of care on one campus so you’ll benefit by paying less for retirement living now but have the peace of mind that a higher level of care is available if needed.
  2. Geography – Where you live affects the cost of senior living the same as it does real estate. In order to keep costs down you might consider communities outside the city or in nearby towns, even a different state.
  3. Amenities – The more luxury you want, the higher the cost as well. Options that affect your monthly cost include your type of residence (private, semi-private, studio, one- or two-bedroom), pet fees, concierge services and private transportation.

Another area in which you have different budgeting options is the fee structure you choose. Although not every retirement living community offers all these options, the most common pricing includes:

  • All-inclusive –All services and amenities the community offers in one monthly cost.
  • Tiered – Different levels of cost options available, each one with a different variety of included services.
  • A la Carte – You pay a base rate for rent that may include some basic services then you’re charged a flat or per-hour fee for every additional service or amenity you use.

Bonus Way to Save

Retirement living in an over 55 community may offer move-in incentives such a month’s rent for free or perhaps assistance with moving costs so always make sure you double-check.  Any little bit helps when it comes to making your retirement dreams reality!

For more information on retirement living in one of our over 55 communities, contact us today to schedule a visit →

 

The Cost of Senior Living at Home vs. Living at a Senior Living Community

In deciding how to make the most of this phase in life, there’s a lot to consider. One of the most important is where you’ll live as really everything else builds from that. When comparing home to senior living communities, often the driving factor is cost and the assumption is that senior living communities are always more expensive. But you know what they say about those who assume. We can make sure you avoid that mistake by helping you compare the true costs of living at home versus senior living communities.

Senior Living Community Options

First, it’s important to understand that senior living is not one size fits all and the cost varies depending on your needs. Whether it’s level of care or amenities, it can seem like the options are endless. And while that customization to your needs is a wonderful thing; it can be confusing at times. Let’s break it down:

  • Independent Living – A lifestyle choice for seniors who require little daily assistance, but seek a vibrant social community free of the hassles of chores and home upkeep.
  • Assisted Living – Provides housing and assistance with daily tasks to support your independence in addition to many of the same amenities as independent living.
  • Memory Care – An environment designed for those with Alzheimer’s and dementia that includes 24-hour supervision, structured activities and a secure environment with specially-trained staff.
  • Age is Just a Number – Approximately 60 percent of centenarians say they don’t feel old and the rest said they didn’t start to feel that way until they were in their 80s.
  • Skilled Nursing – A higher level of supervision and care than in assisted living with24/7 nursing and physical, speech and occupational therapists also onsite.

You also have options for care at home including:

  • Home Health Care – These services include personal care, household chores, cooking, transportation, occupational, physical and/or speech therapy and can be provided on an hourly, as needed or 24/7 live-in basis.
  • Adult Day Care – Offers care during normal business hours, five days a week that typically includes meals and snacks, health monitoring, medication assistance and fitness, as well as enrichment programs and social activities.

Understanding the Financial Costs

As you can imagine, the cost is not one size fits all either. There are a number of factors that affect it including geography, but one of the biggest is the level of care. That’s why you’ll see the cost rise as more support is needed in senior living, and at home. Here’s what you can expect on average monthly from the Genworth 2018 Cost of Care Survey:

Senior Living At Home Cost

Home Health Care

  • Homemaker Services —$4,004
  • Home Health Aide Services —$4,195

Adult Day Care

  • $1,560

In Senior Living

Assisted Living Costs

  • Private, one-bedroom: $4,000

Skilled nursing

  • Semi-private room: $7,441; Private room: $8,365

Unlike other levels of care, there is little published data on average monthly costs for independent living and memory care because it varies so greatly. However, typical ranges are as follows:

Independent Living

  • $1,400 to $4,000 per month

Memory Care

  • $2,000 to $7,000 per month

Be Real in Your Cost Comparison

More often than not we see seniors comparing the monthly cost of senior living communities to their mortgage or rent alone which is not an apples to apples comparison. You must compare to the total monthly cost of living at home which also includes your food, utilities, home maintenance, property taxes, insurance and entertainment costs. Why is this so important? Because these things are typically included in the monthly cost of senior living at a senior community!

And don’t leave out the cost of any home health care (and/or home modifications) to support your needs. Would you believe that as many as four out of five adults underestimate this? According to the Genworth Long Term Care/Caregiving Online Survey the average American actually underestimates the cost by almost 50 percent. Not only is this important in comparing senior living costs, underestimating could mean a huge hit to your budget.

Once you look at the real comparison, you may be surprised to find senior living community cost is actually less expensive in some cases!

Consider the Emotional Cost

We mentioned above how everything else in your life builds from where you live, or more specifically, how quality of life is directly tied to your environment. Beyond the financial there’s also an emotional cost that must be considered. Yes, it can be hard to leave home. But, what’s the emotional toll on you or your loved ones as they take on caregiving roles? How about your own concerns such as home safety and transportation? In addition, do you have enough social and enrichment opportunities to keep you fulfilled?

That’s really where the value of senior living comes into play: the positive impact on quality of life. That emotional cost is replaced with freedom, fulfillment and peace of mind in senior living communities. You’ll have a worry-free lifestyle without unexpected expenses, chores or home maintenance, and the freedom to enjoy a full calendar of social, fitness and enrichment opportunities along with a host of amenities like restaurant-style dining, pool and fitness center. What’s more you’ll have the added peace of mind that support is always available if, and when, you need it. And what might be considered invaluable to you; that instead of caregiving your family can enjoy life right alongside you!

For more information on our senior living communities, contact us today to schedule a visit →