Criteria for desirable retirement location

First think about what are your criteria for a desirable location.  Is it the cost of living or scenery or access to healthcare or activities or potential community or pace of living or some prioritized combination of these?

How to research retirement locations

There are websites to research such retirement locations.  If possible, begin your decision-making process pre-retirement.  Visit on vacations for a high-level screening.  Once you have identified the top choices, before you still sell everything and move, make a longer visit.  Get to know what day-to-day living is like:

• traffic– or ease of public transportation
• activities—social, intellectual, cultural
• attitude toward new residents—welcoming or not so much
• taxes—on retirement income or not
• pace of living—adventurous or relaxed, urban or rural
• healthcare—access, cost, availability of insurance (Medicare and individual plans)
• demographics—lots of retirees or mixed age-range
• opportunities to stay fit and active—weather, geography (walking/bike trails, etc.)

Helpful website:  http://money.usnews.com/money/retirement/best-places-to-retire 

International retirement locations

International locations can fit the bill for cost, beauty, healthcare, activities and adventure, but check openness to non-citizens, taxes, access to local banking, visa requirements, and ease of transportation to and from family and friends.

 Helpful websites:

US News: 6 Affordable Places to Retire Abroad in 2012

Kathleen Peddicord blog on international retirement locations and issues 

The world is open to you, just look before you leap.  Enjoy the adventure!

Effect on Rehabilitation Coverage

If you have a condition that will require follow up admission to a Skilled Nursing Facility (SNF–nursing home or rehabilitation facility) for rehabilitation, such as from a stroke or hip replacement, for Medicare to cover that SNF admission, you need to be admitted to the hospital for 3 days prior to the rehabilitation.  If you are on observation status, that is not considered an inpatient hospitalization and, thus, does not meet that criterion.  Normal Medicare coverage would cover 20 days at full cost.  If you don’t meet that criterion, it would not cover it at all.  If Medicare does not cover it, your secondary supplemental insurance will not cover it either. 

Medicare Part A vs. Part B Coverage

If the hospital stay is classified as observation vs. inpatient, Medicare Part B is covering instead of Part A (Part A normally covers inpatient hospitalization).  If you only have Original Medicare (Parts A and B with no supplemental coverage), the deductible is better–$140 for Part B vs. $1156 for Part A.  However, after the deductible, the difference could be huge.  Once you pay the $140 deductible of Part B, Medicare coverage is 80%.  The remaining 20% of a hospitalization could be thousands of dollars—more than the $1156 deductible of Part A that completely covers 60 days of hospitalization.

What to Do When Hospitalized

After the initial crisis of admission to the hospital is over, make sure someone checks what the hospitalization status is.  If you do not inquire, you may not find out until the bills come in or you find out your stay will not be covered when you are admitted to the rehabilitation facility.  Bottom line, ask.  Your doctor determines the status according to criteria for your medical situation.  If you ask, he/she may be able to review any changes in your medical situation and re-classify your status.  If you are not in a position to be your own advocate, hopefully a family member, friend, or social worker can help you.  Don’t get caught in this confusing situation.

Some information for this blog post was referenced from  www.caremanagementllc.com and 2012 Healthcare Choices for Minnesotans on Medicare. 

 National Healthcare Decisions Day 

On the same theme as my recent blog postings on making choices and then communicating with your family (Leading Your Family…Estate Planning  ,  Caregiving Decisions—Not in Crisis Please  ,   Prefunding Your Funeral), April 16 is National Healthcare Decisions Day.  This day is set aside to provide information and encourage action for the general public, as well as healthcare providers, about the importance of advance care planning.

According to the Pew Research Center’s study in 2006, 71%  of Americans have thought about their end-of-life treatment preferences; 95% had heard of a living will; but only 29% had a living will.

Where can you get information on advance care planning or help completing your Healthcare Directive?

So now is your chance to find out more and take action.  In the Minneapolis-St Paul area, there will be a panel discussion on Minnesota’s Health Care Directive at the Mall of America Hilton on Sunday, April 15 at 1:30 PM, followed by assistance with forms until 5:00 PM.  On April 16, there are several events in the Twin Cities area providing forms and assistance.  See link for Twin Cities events  for the location that works for you.  Nationally, there does not seem to be a website that lists events, but Googling “National Healthcare Decisions Day, your state” should work.  

Okay, it’s not a fun topic, but as Dr. Byock recommends–do it for your family, if not yourself.

Peter’s book, with Kelly Schackman, is called Inheritance Tug-Of-War Stories: How to Pull FAMILY Together Before Your THINGS Pull Them Apart.   Not being a financial advisor, I was amazed to read how common it is for families to become divided when they have lost parents, a time when they need each other for support so critically.

Communicating your estate planning decisions with your family

In other blogs (Prefunding your funeral–why would you do that?  ,    Caregiving Decisions–Not in Crisis Please  ) I have touched on the importance of communicating your desires with your family.  Along with these practical desires, communicating your final financial wishes helps lead your family.  Peter has practical suggestions on tax consequences and financial considerations to share with your family when you are developing your will and estate plan. 

However, one piece I like about Peter’s book is the message that if you make your decisions and communicate them to your heirs, you have set up a way to avoid conflict later.  There may still be conflict, but you can be around to help direct and resolve it while you are still alive. 

Honoring their loved one’s memory

My favorite concept is that if you share your desires with your children, then they will know how to honor your wishes and memory.  When they are sitting around the table, one of them can remind others of what your wishes and intent were if things get out of hand.  Honoring your memory, by remembering that keeping your family together is more important and respectful to you than how you divide assets or possessions, can be a powerful way to diffuse an emotional situation.

If you make your decisions, communicate them to your family and then set up the expectation that your heirs will honor you by respecting your decisions, you have led your family.

Peter also has a specific guide on how to make decisions and hold conversations around an emotional possession, called Cabin Conversations:  What happens to the cabin when we are gone?   To quote Peter, “The very thing that created wonderful memories for families now caused conflict, broken relationships, and the need for legal representation.” 

You can find these books or contact Peter at www.401klatte.com  or call Sally McClellan at 952-882-0400.

What is considered caregiving?

If you provide help with any of these activities: grocery shopping, providing transportation, paying bills, doing laundry, cleaning, shoveling snow, raking leaves, mowing grass, cooking meals, going to medical appointments, or just checking in regularly–you are a caregiver. Link to Wilder Foundation’s Caregiver Resource Center–MN  resources, but universal concepts.

When should you seek help with caregiving?

The best time to seek information about community resources to help with caregiving is before you need them.  Then you have time to evaluate what you need, where services are available, what you can afford and what services might be provided free or on a sliding fee scale.  You would have more choices and time to get the input of the person for whom the services are needed.   You could set up a plan for the future as opposed to being thrown into something during a crisis.

Caregiving costs billions of dollars a year in the US when hours of lost work of family caregivers is included in the calculation.  Some people even leave their job completely to provide full-time care, possibly losing their own health coverage.  With prior planning, some of this loss could be avoided.

Where do you start to find caregiving help?

Start by identifying that you are a caregiver–or carepartner, caretaker, angel of mercy or just caregiving daughter, spouse or friend.  Then you can start looking into ways to provide the best care possible. 

There are support groups for sharing discovered ways to simplify some aspect of care (e.g. simply using a computer camera if paying a monthly monitoring fee is too expensive) and sharing emotions (fear, frustration, anger, fatigue, etc.) that are best not expressed in front of your loved one.

Caregiver training is available to help with basic (bathing, transferring from wheel chair, etc.) to more medical duties (providing injections, IV or ostomy care, etc).

Social workers or care managers can help assess and locate needed services.

Elder law attorneys can help figure out if there are financial options within government programs.  Often their fee is recovered many times over if they can help navigate the eligibility process for government help.

Please refer to a former blog post (Caregiving Decisions—Not in Crisis, Please! ) for contact information for resources.   

Rosalyn Carter said it best: There are only four kinds of people in the world – those who have been caregivers, those who are currently caregivers, those who will be caregivers and those who will need caregivers (link for National Family Caregivers Association).  Remember, you are not simply a child, spouse or friend, you fill a valuable role as a Caregiver!

Often current employees are just longing for the day when they do not have to go to work any longer.  They either feel that how they spend their time in retirement will just take care of itself naturally OR they think they have done a lot of planning for what to do with their time.  Remember from a previous post, that most people spend more time planning a family vacation than their retirement.

 “the 2’s” 

In 2 weeks, 2 months or 2 years, people often hit a point at which they say, “I have spent time with the grandkids, golfed/fished a lot, and taken a bunch of trips; now what?”   This is the point at which they say, I wish I had thought about this more before I retired.  Especially if they had been very active and involved in their career, they need something purposeful to fill that void left from no longer working.

What to do? 

Look to your passion.  Did you want to play professional baseball as a child?  Maybe you can volunteer to usher at baseball games OR travel around the U.S. to see a game at every baseball stadium.  Did you want to be a famous ballerina or actress?   Maybe you can volunteer to usher at a theater in your area.  Think about a dream you may have had to give up in order to pay the bills, the mortgage, college tuition, etc.  Is there a charitable organization that you want to support?  Maybe you do not have a lot of financial resources to give now, but these organizations always need volunteer help.  Is there a business idea you always wanted to pursue?  Now that you have Social Security, maybe a pension and/or 401(k)/IRA, you might be willing to risk your time in trying out your creative idea.  

Stretch yourself.  Think outside the box.  What is it that would give you meaning and a reason to get out of bed in the morning?  Investigate the possibilities before you hit your “2.”

Often one of the first considerations is to sell the home to access the equity for long-term care expenses.  A number of factors should be considered before jumping to that conclusion.

Long-Term Care and Medical Assistance

If the person/s have few assets and are close to being eligible for Medical Assistance to help cover long-term care expenses, selling the home and increasing the assets may not be a wise idea.  Some states do not include assets, such as savings, retirement accounts, investments, etc., in the Medical Assistance calculation.  However, if the state does count assets, often they do not include the house as an asset.  If you sell the house and then have resultant savings, that money is counted.

Elderly Waiver and Alternative Care

A specific type of government benefit funded between the federal and state governments is the waiver program.  Waiver programs for the elderly help provide services that can keep people in their home vs. entering a residential facility.  With the burgeoning number of Boomers getting older and the limited resources of the government to continue to pay for total institutional care, the government is seeking ways to help provide care more economically and efficiently.  Most people express an interest in remaining in their homes.  Therefore, if the government can spend less to keep people in their homes and out of nursing homes, it is a win-win situation.  Most states have different programs and criteria for eligibility.  Again, this may be an option to review before deciding that the home must be sold to afford care.

Extra Help with Medicare Part D

To be eligible for Extra Help paying for your Medicare Part D prescription drug coverage, you must meet asset guidelines.  Currently in 2012, a single Medicare beneficiary can have a maximum of $12,640 in assets.  A married couple can have only $25,260.  The primary residence is not included in the total assets.  Again, selling a house might push someone out of eligibility for this program.

Medicare Savings Program

One of the best kept secrets about Medicare is the Medicare Savings Program.  This program for lower income Medicare beneficiaries either pays only the Medicare Part B premium ($99.90 in 2012) or also covers the deductibles and co-pays for Medicare Parts A and B.  The asset levels are low.  In 2012 for Single–$10,000; for Married–$18,000.  Again, the equity in a house is not counted unless the house is sold and savings results.

Help with Sale of Home Decision

These financial programs are just some of the issues to consider when deciding to sell a house to help aging parents or other senior adults.  How do you decide?  I recently heard a homecare agency professional say that a trip to an elder law attorney  usually pays for itself– in savings from financial decision-making mistakes when planning for long-term care.  Another source of information for state or local asset requirements is often county social workers who help administer these programs (Browse the web for “county social workers” or “county case managers”).  Care managers  who help evaluate housing and service needs and locate service providers can direct you to an appropriate professional for information in your state and situation.  Area Agencies on Aging may also be able help locate these professionals for you.   

There are obviously many factors to consider when deciding how to best meet the needs of your loved one.  The decision to sell the family home can be an emotional one.  Sometimes even though it seems like the simplest way to raise funds to provide services, selling the home may actually interfere with receiving those very services that could make your loved one most happy.  

Often a medical crisis changes things very quickly–a stroke, a fall, an accident.  But even if a parent is aging and has a chronic diagnosis (diabetes, coronary disease, etc.), we seem surprised when independence and living situation finally require change.  I just heard a social worker say that he gets calls from adult children saying they were not expecting this medical/housing crisis with their parent, even though the parent is over 90 years old.  We do not like to think about or plan for difficult situations.

So what are we to do to prepare?  Family discussion is a great beginning.  This is also usually difficult.  Unless everyone is comfortable with emotionally-charged discussions, this one is usually avoided.  Trying to convey what kind of home-based help or housing you might be willing to accept may not be welcomed by your future caregivers.  Everyone knows there will be an end to life, but no one looks forward to enduring physical or mental incapacity before that final event. Here are some helpful resources to begin the process.

Senior Housing

Local resources may be a great place to start the evaluation process.  If you do not have any idea of what kind of living situations are available, try to find a local senior housing guide.  There usually are a wide range of different housing options from independent living to skilled nursing facilities (nursing homes) and everything in-between.  Services range from none to meals, cleaning, personal care and medical care.  Exploring choices before the crisis gives you more options.

Senior in-home services

If you want to age in place and stay in your home as long as possible, investigate what in-home services are available in your area.  A good beginning source might be http://www.eldercare.gov/ from the US Administration on Aging.   

Evaluating what caregiving services are needed

This local Area Agency on Aging Long-Term Care Choices Navigator asks questions to help determine what services are needed and where you might find them.  This specific example is from the Minnesota Area Agency on Aging, but is a helpful framework for looking at areas of need in general.

Professional help

Overwhelmed at the thought of evaluating what is needed, finding the services and discussing it with the family?  A care manager may be the professional to contact.  These former social workers, nurses, counselors and gerontologists work with families to complete all these tasks.  These professionals can be paid by you, the client, or the service providers.  for more info:   http://www.eldercare.gov/ .

Do-It-Yourself Guide for Caregiving

This Caregiving Choices PDF looks at how to help yourself as a caregiver, how to assess what services are needed, how to organize the information you have or still need, how to evaluate legal and financial issues and much more.  This example includes information on national and Minnesota-based services.

Out-of-State Caregiving

http://www.ecarediary.com/ provides a way for families to stay connected and organized even if some of the family members (including the loved one needing care) are out-of-state. So valuable!

This may not be a fun activity to pursue, but if you can force yourself to just do a little research, it will pay off if you ever need to make those quick crisis decisions.  Winter is a great time for indoor research…

Benefits of Prefunding your Funeral

Not only does it save your family from difficult decisions at a very stressful time when you gather and share your wishes for your funeral or cremation, but you might want to consider prepaying the service in advance also.  Why? 

1. Prefunding can protect the family from inflation cost by locking in today’s prices.
2. These funded plans are flexible, and any leftover funds are returned to the estate.
3. Once funds are set aside for this purpose they can become an Irrevocable Funeral Trust which is a protected asset– protected from long-term care costs, not considered an asset for Medical Assistance determination.

Protections for Your Prefunded Funeral

Today there are laws which protect preneed funds in a safe, secure and efficient manner.  Although there are various funding options, the most common and inclusive is the use of a Preneed Insurance policy that is held in the insured’s name until the time of need.  Then the funds are paid to the funeral home of choice, even in another state.  States may have different laws.  Check a funeral home in your state for your options.

This may not be the first item on your list for retirement planning, but it impacts estate planning, financial planning, caregiving and long-term care planning.

Again, have a conversation with your family.  Let them know what you want to do, and find out what is important to them.   They will appreciate your concern now and even more at that future stressful time. Contact a Funeral Preneed Specialist to gather information and assist you in putting funds aside safely for this purpose.  Next up, caregiving.

Information provided by Meg White Heintze, Funeral and Cremation Preneed Specialist           952-201-6504   Heintze5@integra.net

Beneficiaries and other designations

Any financial account for which you can designate a beneficiary provides a way to pass on an inheritance without going through probate.  Retirement accounts and life insurance policies have beneficiaries.  There are payable on death, POD, designations for banking accounts.   Transfer on Death, TOD, are for investment accounts.  Some states (Minnesota included) even have Transfer on Death Deeds, TODD, for real estate.

However, you may want to consult an attorney to make sure you are not missing tax (estate, gift, etc.) or other consequences by trying to avoid a will or trust by using only these designations.  Using joint ownership with children is an area where you always want to check on the consequences of such a move.  You may be limited on what you can do with your assets without your children and their spouses’ consent, and your assets may be included in your children’s assets for the purpose of divorce or bankruptcy.  So what seems simple may become more complicated if you do not know the potential difficulties.

Also, a big consideration is to keep your beneficiary and other designations up to date.  Remember to update if there is a death, divorce, etc.  No one wants to be unpleasantly surprised because a beneficiary was not changed.

Wills and Trusts

A will gives directions for disposition of your property, but it still requires the probate process.  A trust avoids probate and, therefore, may save time, provides more privacy, but costs more than a simple will.  If you have property in more than one state, you definitely need to check if you can have a “simple” estate plan.

There are ways to simplify your estate planning, but remember to consult an attorney before making decisions which can affect your or your heirs’ tax or ownership situation.  Next stop, funeral planning.