≡ Menu

Long-term Care Options for Early Retirees

{ 58 comments }

Long term care options for early retireesLast week, Revanche from A Gaishan Life asked a question on a subject that I’d rather not think about: long-term care. 

“I might have missed this but I’m wondering what the backup plan is for those folks who are relying on keeping expenses low in retirement should their expenses rise due to factors beyond their control?
My primary example here is always health because I supported my mom through ten years of declining health and dementia. I kept my personal expenses bone cheap to afford it but her expenses rose into the five figures, at times, and that would have been incredibly hard to keep up with if I didn’t have the option (and energy!) to work nearly endless hours of overtime. One of the worst thoughts in the world after she died suddenly was realizing that for the first time, I could afford some version of a life.
If we’re lucky, we’ll live long and cheap, and die quickly, but most people I know at the end of their lives require some form of long-term care and not all are lucky enough to have family who care enough and can afford to provide it for them.”

That is a tough question, but most of us will need to deal with long-term care at some point. Early retirees are usually young and healthy so we think we can keep the same budget. However, LTC is very expensive in the United States. A frugal budget probably can’t cover the cost of LTC.

Long-term care (LTC) is a variety of services which help meet both the medical and non-medical needs of people with a chronic illness or disability who cannot care for themselves for long periods (via Wikipedia.)

Let’s look at parents

I’m 42 and I won’t have to deal with long-term care for myself for a long time. However, my parents are getting older and they will need my help. My family doesn’t have a history of needing long-term care, but everyone is living longer now so that might change. Mrs. RB40’s parents are also getting older and may need help at some point. Everyone is divorced so they’re all on their own.

  • My dad is 71 and lives in Thailand. His parents passed away suddenly when he was just 5 years old. We don’t really know what the problem was. One of his brothers had a stroke 7 years ago and he lives at home with in-home care. All his other relatives who passed away did so without needing long-term care.
  • My mom is 67 and she lives in the US. Her dad passed away from a massive stroke when he was 60. Her mom passed away from cancer and brain tumor complications when she was 82.

Luckily, we don’t have a family history with dementia, Alzheimer’s disease, or Parkinson’s disease. When I die, I want to go quickly like my grandfather who died peacefully in his sleep. Not screaming like the passenger in the backseat. An old joke to lighten the mood a bit. This subject is such a downer.

Long-term care options

Let’s look at some options on how to pay for long term health care.

Pay for it yourself

Most of us will have to pay for long-term care at some point. Long-term care is very expensive, though. The Genworth 2015 Cost of Care Survey showed the following for California. CA is actually cheaper than Oregon for some reason.

  • Home Health Care: $52,624 per year for home health aide.
  • Assisted Living Facility: $45,000 per year.
  • Nursing Home Care: $89,396 per year for semi-private room and $104,025 for private room.

This will quickly deplete anyone’s retirement fund. Let’s look at some other options.

Medicaid

The next option for US citizens and residents is Medicaid. Medicaid is a social safety net meant for people with limited resources and the elderly. I’m not an expert and the rules here are pretty complicated. From what I understand, your income must be below a certain threshold and you have to demonstrate need, i.e. not having much liquid assets. Here is Revanche’s input.

“You can get some kind of minimal care, but it can amount to nearly nothing, in some states so it would be good to keep close tabs on it. My mom was on Medicaid after years of applications and being sick, she never would have survived to have her application approved if I didn’t take over providing for her, and they kept reducing benefits/coverage. Sadly, the Medicaid provided care was also incredibly poor quality.”

It sounds like the quality and availability of care vary widely from state to state. My mom would be a good candidate for this program because she has very little income and not many assets. If you are considering Medicaid and have some savings, you should contact an elder law attorney who specializes in Medicaid planning. They could help you keep some of your assets and clarify the law.

Note: Medicare, the program most of us qualify for, does not pay for long-term care.

In-Home care

Care in the home provided by a spouse or a child is the most common form of long-term care in the US. About 73% of all LTC is provided at home by unpaid caregivers. This would be the first choice for my mom. I’m mostly retired and I will be available to provide LTC for her when she needs it. In some cases, it won’t be possible to provide care, though. Dementia for example starts off small and turns into a huge problem as the disease progresses. As I understand, Medicaid can help defer some costs here if you need to hire some aides.

This option won’t be possible for my dad because he refuses to move to the US. I could go to Thailand for a few months, but I can’t leave my family here in the US for much longer than that.

Relocate to a cheaper location

Young retirees can move to a more affordable country to reduce their cost of living. The same concept could be applied to long-term care. What about moving into a nursing home in Mexico or Thailand? This is a real possibility for my dad because he already lives in Thailand. The nursing home business is pretty new in Mexico and Thailand. The family usually takes care of their elderly at home. In the past, families had many children who could all help shoulder the burden. Now, families have fewer kids so nursing homes are becoming options more and more.

I researched a bit on the internet and found a couple of places in Thailand.

  1. long term care optionsNamthip Nursing Home in Pattaya – This one seems like a typical nursing home that can accommodate foreigners.
  2. Care Resort Chiang Mai – This one looks like a luxurious resort!

The single occupancy cost for both of these facilities is about 50,000 baht per month. That’s less than $1,500 per month at the current exchange rate. These prices include all meals, maid service, nursing and care, and utilities. Their care staff are either fully qualified nurses with a degree in nursing or carers who have completed an assistant nurse training. The dementia unit at the Care Resort CM starts at 80,000 baht.

This might be a good option if you have a modest budget and don’t mind the long distance. $1,500 per month isn’t bad at all. That’s less than our current monthly cost of living. Of course, you would need to thoroughly check out the facility and staff. The website looks nice, but I need to see it in person. I’ll put this on my to-do list when we visit Thailand later this year.

Mexico probably would be a better option for most northern Americans.

Long-term care insurance

If your family has a history of needing expensive long-term care, then it’s probably wise to investigate long-term care insurance. The cost varies widely with age, health, and coverage. It looks like the cost for a single 55 year old person is about $2,000 per year.

Other options?

Well, that’s all I got on this subject. I’m sure we will go through a few of these as our parents get older. We will apply the learning toward our own long-term care planning. We only have one kid and he might not be able to help that much so we probably have to budget for long-term care.

Are you dealing with long-term care? What the plan for yourself and your parents? Let me know if you have another option to add.

Final inappropriate joke

One evening, a family brings their frail, elderly mother to a nursing home and leaves her, hoping she will be well cared for.

The next morning, the nurses bathe her, feed her a tasty breakfast, and set her in a chair at a window overlooking a lovely flower garden. She seems okay but after a while she slowly starts to lean over sideways in her chair. Two attentive nurses immediately rush up to catch her and straighten her up. Again, she seems okay but after a while she starts to tilt to the other side. The nurses rush back and once more bring her back upright. This goes on all morning.

Later, the family arrives to see how the old woman is adjusting to her new home. ”

So Ma, how is it here? Are they treating you all right?” they ask.

“It’s pretty nice,” she replies. “Except they won’t let you fart.”

Image by ulrichkarljoho

The following two tabs change content below.
Joe started Retire by 40 in 2010 to figure out how to retire early. He spent 16 years working in computer design and enjoyed the technical work immensely. However, the job became too stressful and Joe retired from his engineering career to become a stay-at-home dad/blogger at 38. Today, he blogs about financial independence, early retirement, investing, and living a frugal lifestyle.

Passive income is the key to early retirement. This year, Joe is increasing his investment in real estate with CrowdStreet. He can invest in projects across the U.S. and diversify his real estate portfolio. There are many interesting projects available so sign up and check them out.

Joe also highly recommends Personal Capital for DIY investors. He logs on to Personal Capital almost daily to check his cash flow and net worth. They have many useful tools that will help DIY investors analyze their portfolio and plan for retirement.

Latest posts by retirebyforty (see all)

Get update via email:
Sign up to receive new articles via email
We hate spam just as much as you
{ 58 comments… add one }
  • Mrs. SimplyFinanciallyFree May 4, 2016, 12:51 pm

    I am actually licensed to sell Long Term Care insurance so I know a bit about that but you did make me realize something important. I have always thought that my husband and I would be able to self-insure our own needs but I neglected to plan for my mom. I have been offering my help for years to get her finances straightened out to no avail and she is going to be struggling to even be able to retire, let alone ever be able to cover any long term care needs she might have. If I am retired if/when she needs care I wonder if we would have to provide for her care. I think we might drive each other crazy if we ever have to live together but shelling out money to cover for her care would certainly impact our own security. And I don’t know if I could live with the thought of putting her in any old Medicare approved home as the quality of care might not be up to par. Ugh…if only our parents were as good with money we are.

  • Dollar Bits May 3, 2016, 9:46 pm

    The rule of thumb is that you’re a candidate to buy long-term-care insurance if you have between $200,000 and $2 million in assets. If you have more than $2MM, the thinking is that you self-fund this expense. If you have less than $200K, and don;t have any coverage, you’ll still get care, which will be funded by whatever savings you have and Medicaid will back-fill, if needed.

  • Erik @ Hippies de Land Rover April 29, 2016, 1:16 am

    Hi Joe, great article, most of the time this is an argument that is forgotten. As you mentioned most of the early retirees forget that one they we’ll all be old 🙂
    Our strategy is:
    1. To have a good health insurance to be protected against any “critical” long term illness
    2. Have enough money in our savings account so that if we want to remain in Switzerland we can live with it.
    3. Move to a cheaper country like Mexico and enjoy a nursing home in one of their beautiful beaches.

    Cheers!
    Erik

    • retirebyforty April 29, 2016, 7:48 am

      How is the cost of the nursing home in Switzerland? I imagine it would be more than the US. Cost of living is high over there. Thanks for dropping by!

  • James April 29, 2016, 12:27 am

    This is an important topic, is there any specific difference that an early retiree have to take into account for long term care compared to someone planning to work to 60s and 70s? I would think people should get it after a certain age and that it’s just an added insurance cost item.

    • retirebyforty April 29, 2016, 7:45 am

      I think early retirees tend to forget about LTC because they’re young. I guess to keep checking on the cost of LTC insurance and budget for it if you can.

  • Daizy April 28, 2016, 4:40 pm

    My strategy is to curl up in the corner while mumbling to myself and try to ignore the issue. My sister had an aneurism at age 25 and was in a nursing home for 15 months until her death. After spending her meager savings, her care was paid by Medicaid and the facility was less than great. My father suffered from Alzheimer’s for 7 years. My mother took care of him until the last 2 years when he went in to a facility at a cost of $3k/m which is quite cheap for the U.S., I hear. He paid for it from his pension. He ended up dying in a group home after breaking his hip in the nice facility. The nice facility jacked up the price to $4,500k/m and my mother picked the cheaper group home option for $1,800k/m. He only survived 3 months at the group home. I have conflicted thoughts about this since his quality of life was not great at the expensive place or the bargain place. No one wants to think their parent died of neglect though. My mother is slipping mentally and frail but is determined to live alone and not go in to any type of community living situation. It will be beyond her control, eventually, and she will have to pay from her savings. Since my relatives seem to die in their 70’s, I hope to semi-retire in my 40’s and live independently as long as possible. If/when I can’t live alone anymore, I guess Medicaid will be enough to stick me in a group home.

    • retirebyforty April 29, 2016, 7:43 am

      Sorry to hear about your negative experience. You should budget for LTC insurance with your family history.
      I think early retirement is the way to go for you too. Enjoy life while you can, right? 🙂

  • Claudia April 27, 2016, 8:41 pm

    Both my parents, my stepmom and my uncle and my aunt have lived in Skilled Nursing Facilities. My father had Alzheimer’s, died at 90 and his wife died at 97, health issues. Together they spent over 600K on health care.
    My uncle had Alz., died late 70’s. He was my dad’s brother. Not sure how his care was paid for.
    My mom’s sister, who broke her hip and had dementia paid for the facility herself. 120K. I took care of her care. She died at age 90.
    My mom will be 97 this year and has gone through her money and her sister’s (inheritance) total of 500K. Now I face her having only 1 more year of money. She has dementia and lives in a Skilled Nursing Facility. I now face having her move to a Medicaid facility. Right now she lives in a private pay facility.
    Needless to say I have LTC insurance.

    • retirebyforty April 29, 2016, 7:39 am

      Wow, that’s scary. Thank you for sharing your story. You just have to live life now and enjoy it while you can.

  • The Jolly Ledger April 27, 2016, 4:38 pm

    This post made me look back on some of my long term projections. By keeping expenses low in the early years, our assets should allow for these kind of health costs later in life. We do have a history of dementia in my family, so considering long term care insurance is probably a good idea. Thanks for the tip! Luckily, my parents have the funds to cover their LTC expenses and I won’t have to worry about the financial end so much. However, for myself, I love the idea of long term care in a different country but I have no idea what healthcare will look like in this country in 40 years.

  • Peter Robinson April 27, 2016, 3:51 pm

    Joe,

    Good topic, glad you brought it up. I have worked in the long term care industry for 20 years. I see way too many people who mistakenly believe medicare will pay for their long term care if they need it. Medicaid will pay but you have to be impoverished (which would mean going broke and hoping the government takes care of you. No thanks! )
    Many people are not aware of a type of community called “continuing care retirement community, CCRCs”. CCRCs combine housing, resort like amenities and comprehensive long term care all on one campus for seniors. For those who don’t want to rely on their kids, neighbors, relatives or the government to take care of themy as they age I’d recommend looking in to a CCRC. You can find more info on CCRCs at leadingage.org

    • retirebyforty April 29, 2016, 7:37 am

      Thank you for your input. I will look more into CCRC. It sounds like a more independent community.

  • Lady Butterfly April 27, 2016, 2:27 pm

    My parents are in their late 60’s and they don’t have LTC insurance. If anything happens to them, I think I will become their full or part-time care taker. Depends if they qualify for Medicaid. Medicaid is not free. It’s like a loan, if you have illiquid assets. My parents have a house, so once they pass, Medicaid will have to be paid back with the sale of the house.

    My current company offers LTC insurance, so I bought it in my early 30’s. I am not sure if the premium is subsidized, but I am paying about $180 a year. I never want to become a burden or an inconvenience for my family members, so I bought it when it was offered.

    • retirebyforty April 29, 2016, 7:34 am

      I’m pretty sure, the house is protected. Check with an elderly law attorney before making any drastic moves. I heard the Medicaid staff are under-trained and don’t the law that well. I had LTD insurance when I was working too.

  • Alan April 27, 2016, 1:57 pm

    “I’m 42 and I won’t have to deal with long-term care for myself for a long time.”
    I think this is a big misconception. While older people require long-term care more than younger people, that isn’t always the case. A friend of mine was in a car accident, and is now a quadriplegic. Even with health insurance he requires constant care and will for years. There are also many diseases that can leave you disabled needing long-term care. You will get SS disability but its not great.

    • retirebyforty April 29, 2016, 7:32 am

      Thanks for bringing this up. I used to have LTD insurance when I was working full time. Everyone should try to get it through work. My SS disability is around $2,700. That’s not much, but it would help..

  • Getting To One Million April 27, 2016, 12:29 pm

    This is one reason I’ve chosen to save 1 million and have my social security as extra money for long term care. According to Fidelity’s retirement calculator, if I retire at 62 with 1 million and take social security at 62 my first withdrawal amount will only be 1.8% of my portfolio and that’s in underperforming market conditions and with only 75% of my social security benefit (which is what is predicted in 2034 when the trust fund runs out). That’s also with all of my assets in short term funds which is what I’m invested in now. I don’t want a higher paying stressful job so it will take me about that long to hit 1 million. I’m 48 now and only have a sinus issue I have to take medication for and I rarely have any sinus problems because I do a lot of preventive care.

    • retirebyforty April 29, 2016, 7:30 am

      It’s good to have some margin. 1.8% is really good and your portfolio should last a long time. LTC is such a huge drain, though.

  • Pennypincher April 27, 2016, 12:19 pm

    Joe, when does your best selling book come out on Amazon from all these great posts (and comments) you’ve done??
    I do wonder about people who don’t plan or even think about this final stage in life. All I know is this from experience….
    I want to go fast, peacefully in my sleep, w/favorite family members around, hopefully. No long drawn out painful burden for me or family members. I’ve also read in the NY Times, that LTC insurance is not what it’s cracked up to be, so buyer beware.
    I am checking into those Thailand nursing homes when I’m ready, they look like heaven on earth!
    Thanks for bringing up a tough subject for all to think about.

    • retirebyforty April 29, 2016, 7:29 am

      Thank you for the encouragement! I’m not sure about the LTC insurance either. It seems like the term wouldn’t cover long term assistance if 3 years is length of the payout. I need to look into them more.

  • Revanche April 27, 2016, 11:40 am

    Thanks for the link and discussing this further. Gallows humor is sometimes the only thing that helps us focus on moving forward when the subject is death and other related depressing things!

    At the time my mom was ill, I was trying to find options for LTC and they were all pretty bad, and really expensive. We were a less global community fifteen years ago, so the idea of setting her up in another country was absolutely not an option to me, but I wonder if that would have made a difference.

    As other commenters have noted, we can only hope that we’re free from any accidents or illnesses that leave us alive but incapacitated but it’s kind of a crapshoot, isn’t it?

    • retirebyforty April 29, 2016, 7:20 am

      I wouldn’t mind setting myself up in another country, but I’m not sure about doing it for my parent either. My dad probably would be fine with it, but not my mom. Yeah, I don’t like the odd on this crapshoot although things look okay from my family history.

  • Sara April 27, 2016, 11:28 am

    When the time comes, my husband and I will be buying LTC insurance. My grandpa had Alzheimers, so I saw first hand how much care can cost. He did have LTC, but still had to pay out of pocket quite a bit for his care. BUT, that LTC insurance allowed him to live in a very nice facility. He would never have been able to manage that place with out the insurance.
    I still have living grandparents in their 90s who are currently living in their own home, but if something were to happen to either one of them, we would have to move them and then the rest of us would have to chip in for their care. I would never ever want to burden my family with that.

    That being said- I never realized LTC cost as much as it does. Geez! Lots to think about before we purchase it.

  • Julie April 27, 2016, 11:08 am

    It’s good to see a post on this topic, and very timely for me. I have older parents, plus an Aunt who lives in my area, and am seeing two wildly different scenarios that cause me to reflect on my own LTC plans. My parents were very frugal and made a decision to ‘self-insure’. My siblings and I are now helping them make decisions about whether to leave the family home and live where they can receive more care and be around more people ~ but lack of money isn’t really a factor in those conversations. Thanks for planning Mom and Dad! This makes everything much easier and less worrisome for the whole family. On the other hand, my single Aunt retired at 50 and counted on her pension and social security to support her comfortably. Unfortunately, she didn’t have much in additional savings, and her pension did not end up providing the cost of living increases she’d assumed. This scenario is turning out to be unsustainable, as she now needs some assistance and is having trouble meeting expenses at her independent living facility. This puts her in a vulnerable situation, and the family feels more anxiety and may need to step in to help financially. This is a tough issue to plan for, with many unknowns and lots of emotion ~ it seems like there’s really no way to be sure you ‘have enough’ money. Lessons learned from the previous generation need to be incorporated into our own life planning, and retirement decisions, and we’ll continue to reassess as things change. We decided to joyfully leave our corporate jobs at 51 with a good nest egg that we believe should enable us to be resilient enough to self-insure for long term care.

  • Running Up Freedom April 27, 2016, 10:15 am

    Good post and important topic! I need to research in more detail, but I believe you can use Health Savings Account funds to cover at least part of your long-term care insurance premiums. We are planning to max out our HSA for the next few years to get the tax benefit. Hopefully, these funds can then grow tax free and be used for some of the long-term care costs. Of course, there’s still tons more to think about in terms of what age it makes sense to purchase long-term care insurance (if at all), but certainly was one of the many reasons I think contributing to an HSA is beneficial for those of working toward financial freedom.

    • retirebyforty April 27, 2016, 11:35 am

      Thanks for that input. I don’t know much about HSA because Mrs. RB40’s plan doesn’t have that option. It’s a good plan.

  • JasonInVancouver April 27, 2016, 9:37 am

    We’re looking to build up a big enough nest egg to factor in financial costs for potential health and care issues down the road. I know some financial planners suggest against this but I’m hoping we’re able to live off our returns and not have to touch our principle. It’s forcing us to work a few years longer than we need to but I have this ongoing fear of running out of money in retirement.
    In the earlier years, it will allow us to travel more extensively or also take care of our parents if they run into issues. In the later years, it gives us options if we encounter health and care issues. Selling the house is the final factor of safety since if it gets to that point, we wouldn’t be able to maintain the house ourselves anyways.

    • retirebyforty April 27, 2016, 11:35 am

      Having a margin of safety is a good thing. Your plan sounds good if you don’t mind working a few years longer.
      The house is one of the exempt asset from medicaid so you should keep that in mind. A lawyer would be helpful at that stage.

  • Physician on FIRE April 27, 2016, 9:22 am

    Nice job bringing a little discussed topic to the forefront. I think the best answer for most of us would be LTC insurance if we’re depleting our nest egg in retirement or self insurance (pay from the nest egg if LTC is needed).

    Early retirees with a <4% withdrawal rate and/or at least average market returns in the first 10 years or so in early retirement will likely be in a good position to be self insured. The 4% SWR is based upon worse case scenarios and most years the nest egg will grow.

    Unless you're in Joe's backseat and suffer a debilitating injury while young, or get very unlucky in another way, you will probably know if you've got enough money to cover LTC by the time you're old enough to need it.

    • retirebyforty April 27, 2016, 11:33 am

      Medicaid seems like the only choice for most people. You’d have to divest your assets, though. That’d be tough.
      The problem is you won’t know if you need LTC until you’re old. It’s hard to plan for. My dad seems healthy, but who knows.

  • Nathan April 27, 2016, 9:02 am

    Great post. This is something that most of us will need to deal with in our lifetimes, either for ourselves or for our parents. Health care is so expensive in the U.S. that retiring abroad is a wise move to save retirement money. My wife and I talk frequently about retiring somewhere in Asia or India for this reason. Also because it would be great to spend part of our lives getting to know another culture and location. Thanks for sharing.

    • retirebyforty April 27, 2016, 11:31 am

      Healthcare cost is ridiculous here in the US. It seems much better in Canada, but I guess they have their problems too.

  • freebird April 27, 2016, 8:39 am

    This may be one of the risks of retiring early with a large nest egg if your parents are alive–
    https://en.wikipedia.org/wiki/Filial_responsibility_laws
    So it might be worth buying LTC insurance for your parents if they don’t have it. But I understand one of the unknowns is how much premiums can rise in the future. It would be a tough choice between accepting a future rate shock vs walking away from something you’ve paid into for many years.

    My plan for myself and my parents is to self-insure. True LTC rates seem high now and we don’t know how far they’ll rise in the future, but I doubt we’ll see a situation where they rise so much that literally nobody can afford it. That may be the case for certain new medical treatments but I imagine those should be categorized as medically necessary and so would be covered by Medicare. The costs for basic living and non-medical supervisory services I believe should not rise so quickly. At today’s rates I think I can manage for durations that don’t exceed the average.

    • retirebyforty April 27, 2016, 11:30 am

      Wow, thanks for the info. I did not know about the Filial responsibility laws.
      I haven’t been able to get real LTC insurance rate because I didn’t want to sign up for a quote. I will check it out for my parents. Aren’t they too old for LTC insurance?

  • Justin April 27, 2016, 8:15 am

    I confess to not having a great plan for long term care if needed. So far, 3 grandparents have died in their 70’s without going to a nursing home (some had short to moderate hospital stays then they were gone). I guess I would take that over 10 years in a nursing home with dementia… I need one of your jokes here, Joe, to lighten the mood. 🙂

    Since we don’t plan on depleting our stash over the next several decades, by the time we hit our 60’s or 70’s, we should still have plenty to afford a decade of in home care or nursing home. If not, there’s always medicaid I suppose as a last resort.

    Typical nursing home stays are usually just a few years and then you’re dead so the odds are strongly in our favor that either we’ll bypass the nursing home completely or it’ll be a short stay and then kaput.

    • retirebyforty April 27, 2016, 11:21 am

      Your family history is in your favor just like me. 🙂 I definitely don’t want to linger around too long.

  • Steve April 27, 2016, 8:02 am

    From your post:

    “I’m 42 and I won’t have to deal with long-term care for myself for a long time.”

    I certainly hope this is the case, but unfortunately accidents or illness can happen at any age that necessitates long term care. I have a cousin in his early 50’s who had a stroke, and was left in a wheelchair, and has very limited use of his arms. He requires assistance to eat, bathe, use the toilet, etc. He is fortunate in that he had resources available to him, and has live-in help to meet his daily living needs. I recognize that the probability of this occurring to a “young” person is low, it can happen, and my own thought is that many people who retire early are taking on a level of risk that could potentially leave them in a situation without resources to provide necessary care for themselves or a spouse/partner. I am not suggesting my cousin’s situation is likely to happen to a 42 year old, but I am suggesting that one should be aware of the possibility (and expense) of such an event should it occur at any age.

    • retirebyforty April 27, 2016, 11:00 am

      I hope to be healthy for at least 20 years, but you’re right. You never know. I think your cousin can get Social Security disability benefit, right? That’s a tough position to be in. I hope his condition improves. Thank you for your input.

  • Felipe April 27, 2016, 6:49 am

    This is not meant to be controversial, but as I age and think of quality of life issues I might be thinking of which state has right to die laws that may allow me to go out on my own terms and not burden my heirs with expensive care prolonging a life I don’t want to live. I can’t make that decision for anyone else, but I hope society can let me make it for myself. That being said, I’ve often said my long-term care plan involves Bolivia.

    • retirebyforty April 27, 2016, 10:59 am

      Thank you for your input. I don’t know enough about the right to die issue to make an inform comment. Do you have to be terminally ill to get assistance? Don’t know much about Bolivia so I don’t understand your reference. 🙂

  • al April 27, 2016, 6:44 am

    So what kind of visa does a US citizen need to live in an assisted living facility in Thailand? How can a US citizen pay for medical expenses there? How do i coordinate/pay for a serious event like a broken hip from a fall, how to get/pay for meds and deal with this from the US? I thought about placing Dad in a facility in the Philippines but then it’s difficult to coordinate services remotely (banking, meds/tests/doctor visits) or visit him anymore. Medicare can’t cover your medical expenses outside the US unless you visit Guam. Seriously, if i get laid off and run out of money from paying for his assisted living care ($3K/month) now in the US, I will have to consider placing him outside the US.

    • retirebyforty April 27, 2016, 10:56 am

      All great questions. I think you can get a one year retirement visa and renew it every year.
      You can probably do a bank transfer to pay the fee or set up an account in Thailand.
      I’m not sure how to coordinate medical events. I will ask that question when I’m there.
      Send the questions to the contact page of the facility. They answered my questions quickly and seems helpful.
      Good luck.

      • Mike Drak April 27, 2016, 11:05 am

        You might want to look at the book Planet Boomer by Jim Herrler and Ellen Ma or visit their web site http://www.planet-boomer.com. The book gives advice on retiring in Southeast Asia and gives advice on visas and health care. If i had the guts that is the route that I would take.

  • Mike Drak April 27, 2016, 6:16 am

    I just went through this process with my mother in Canada who just turned 90. Previously she lived in a retirement home which cost $54,000 per year but her health deteriorated and we had to cover additional health costs of approx $40,000. She was transferred to a nursing home recently and her private room costs approx $32,400 which makes a big difference and takes a lot of pressure off. I visit with her often but and please take this the right way I don’t feel that is the route that I wish to take when it is my time. I’m thinking that when I lose my health, to go the old viking funeral route. Existing is not living in my book and that is not the way that I want to go out but everyone is different.

    • retirebyforty April 27, 2016, 10:52 am

      Thank you for sharing. What is the Viking route? I don’t know if I’d have the gut for that. I just hope I go quickly and my family history suggest that I won’t linger.

      • Mike Drak April 27, 2016, 11:00 am

        It’s when they push you offshore in your boat with all your valued possessions and someone shoots an arrow and sets your boat on fire. In my case it would be my fishing boat but you could use the kayak you were thinking of buying.

  • chris @Apathy Ends April 27, 2016, 6:01 am

    While I am not anticipating taking care of myself or my parents for a long time still, my Grandma recently moved into my parents house while they find an assisted living situation for her. It sounds like my parents and my Moms siblings will have to pay a decent chunk of the monthly cost because social security will not cover all of it.

    Even for a moderately healthy person, assisted living is pretty expensive and only goes up as health starts to slip.

    Definitely not an enjoyable topic to think about – but better to start planning early for worst case scenarios.

    • retirebyforty April 27, 2016, 10:51 am

      I didn’t think Social Security covers any long term care cost. I will check it out. Assisted living is very expensive in the US because the labor cost is very high. I hope your grandma finds a nice assisted living facility.

  • Jim @ Route To Retire April 27, 2016, 5:35 am

    Let me start by saying the jokes, especially the backseat one, helped brighten my morning so thanks for that!

    You’re right that this is a real downer of a subject but thanks for posting about it. I’ve been starting to think about this a little bit as my mom is about to turn 70 this year. It’s not that old, but it’s a milestone for sure.

    As I continue to get closer to financial independence, this could be a cost that I never factored in – taking care of our parents. I know that neither my parents nor my wife’s parents have a good amount saved up, so the reliance would likely fall on our shoulders. So much for the peace and quiet of early retirement for us!! Just kidding… or am I?! 🙂

    — Jim

    • retirebyforty April 27, 2016, 10:48 am

      It’s a tough subject. Nobody wants to think about long term care, but we probably will have to deal with it someday. I’m more worried about Mrs. RB40. I suspect I will go quickly, but women lasts much longer than men. I’ll make sure Jr takes care of her.

      • Mr. Tako @ Mr. Tako Escapes April 27, 2016, 2:57 pm

        I think that’s really key Joe. No one cares about our loved ones as much as family does. We don’t know what nursing home staff do when we aren’t watching. I’ve heard horror stories.

        What did people do before all these new long term care options? Family. In my mind I have two strategies:
        1. Have more than enough $$ to cover those costs, regardless of the country I reside.
        2. Family. My wife will probably outlive me by a good 20 years, and my boys will probably outlive me too.

        • retirebyforty April 29, 2016, 7:36 am

          Right. That’s why it’s important to take care of your elderly. It would be tough if they are in another country. I’m more worried about my wife too.

  • Believe Fire April 27, 2016, 5:19 am

    Thanks for posting this. It really is a tough subject to think about, but obviously very important. We’re both young and healthy and our parents are healthy for now…however we need to plan accordingly for their lives and ours. We may end up retiring abroad, which could make it more affordable and familiar if one of our parents were to move near us for care.

    • retirebyforty April 27, 2016, 10:47 am

      What country are you thinking about? The service wage in some countries are much less than here. It makes a lot of sense to retire abroad.

      • Believe Fire April 27, 2016, 2:58 pm

        We’re not sure, but we are in the process of figuring that out. We spent 7 weeks in Ecuador which was amazing and we’re currently hanging out in beautiful Portugal. There’s a lot of the world still left to see and plenty of great places that aren’t even on our itinerary this year.

  • The Green Swan April 27, 2016, 4:33 am

    Hi Joe, good detail in the post, thanks. This is a tough subject, but we all need to hear it. Healthcare is the cause of ~60% of all personal bankruptcy in the US. It is irresponsible to not plan and take healthcare into full consideration. The way I see it (and the way I’m planning for it) is being appropriately insured and/or being able to pay for it myself. Relocating to another country just isn’t feasible for most people including myself. Uprooting my life and being far from family and friends just for cheaper LTC…I’d probably rather die. In-home care from spouse or child can be an awful burden that I wouldn’t want to put on someone else…and irresponsible if that is what someone is planning to actually rely on. Medicaid is obviously not ideal. I don’t really see any other feasible option.

    A lot of healthcare costs in later years (age 60 and over) are a result of lifestyle choices. I plan on taking great care of myself, being in good health to avoid much of ailments that affect many in America (diabetes, cardiovascular issues, obesity, etc which result from poor diet and lack of exercise).

    Again, good post Joe. Hopefully it serves as a wake up call for many.

    The Green Swan

    • retirebyforty April 27, 2016, 10:46 am

      That’s a good way to take responsibility for your own care. LTC insurance doesn’t seem that expensive, but I think the coverage is also limited. I think the $2,000/year policy pays out around $150k over 3 years. If you need more, then you probably need to buy more coverage. I wouldn’t mind relocating to a different country. It depends on the level of service, of course.

Leave a Comment

This site uses Akismet to reduce spam. Learn how your comment data is processed.