Wow! Have you ever heard so much doom and gloom in your life? These are times when the waves of bad news coming out of Washington and the news sources about the economy can make you just want to give up or even “stay indoors.”
For some of you, this may seem like deja vu (the Depression), and for others, like me, this is our first time experiencing this large of a downturn.
However, there has never been a time to be more proactive in making decisions about long term care, how to pay for that care, and how to protect as many assets as possible so that your loved ones can take care of themselves.
Let us talk about some of the impact I see on seniors. At the same time as the value of our savings has decreased in situations where the savings are in the market, the cost of long term care has increased. The result is that the ratio of the value of assets ( now lower in value) versus the cost of care (now higher) is a negative for families – a larger portion of a person’s assets will be used to pay for long term care.
Compounding the problem is that families paying for long term care are cashing in greatly depreciated assets (e.g., selling mutual funds that have gone down in value because of the dropping market). Many relied on income generated from investments to supplement their social security, and still others have lost huge amounts in their retirement plans. Others took mandated required minimum distributions from their IRAs at a time when the market was down, compounding the decreased value in their IRAs.
Is the end in sight? No, not for the foreseeable future. Most “experts” say (guess, in my book)
that the recovery will be a long one.
So it is time to take action. Here are some tips.
Powers of Attorneys for healthcare and financial decisions, Living Wills, and Wills in place.
Medicare, SSDI, home and community based services, and Medicaid); and determine how you
can preserve assets for the chronically ill person or that person’s spouse or care givers.
Stimulus Recovery Act passed just this month.
Congress has suspended for one year, required minimum distributions from peoples’ IRA for the year 2009. The Economic Stimulus Recovery Act was passed and should provide some recovery or at least stop the free fall that we have been experiencing.