5:38 p.m. | Updated Tara Siegel Bernard has just posted another interesting article on aging parents and their finances: “Stepping In When a Parent Can No Longer Cope.”
The Times published on Friday a special section devoted to the financial struggles of the “sandwich generation” — middle-aged adults who must support both children and aging parents. Three articles are likely to be of particular interest to New Old Age readers.
In “What’s a Pooled Trust? A Way to Avoid the Nursing Home,” Tara Siegel Bernard writes:
There is a little-known way for some people in certain states to receive home care through Medicaid, without requiring them to impoverish themselves first. Here’s how it works: a federal law established in 1993 allows disabled people to put their monthly income or assets — above the amounts Medicaid allows them to keep — into a special type of pooled trust. They can then use the money in the trust to pay for their basic monthly bills like rent, a mortgage payment or cable television. Medicaid, meanwhile, pays for the home care.
In “Ignore Long-Term Care Planning at Your Peril,” Your Money columnist Ron Lieber wades into the controversy over long-term care insurance:
You would think that there would be far more than seven million policyholders, given that costs for long-term care could easily reach seven (yes, seven) figures per individual 20 or 30 years from now.
As you dig deeper, however, you discover at least nine things standing in the way of consumers purchasing coverage, all of which are outlined below. They’re all complicated, with some reflecting outright ignorance and odd rationalizations rooted in emotion. But there is also a great deal of justified skepticism about the long-term care insurance industry.
Ms. Bernard tackles another kind of insurance in “Income Security in Your 80s, Bought in Your 60s” — longevity insurance.
At its core, longevity insurance is simply a deferred annuity: you hand over a pile of cash to an insurance company, usually around the time you retire. But the guaranteed payments begin much later, usually around 80 or 85, and last for the rest of your life. As with homeowner’s policies and other types of insurance, the idea is to give up a smaller amount of money now, for a potentially larger payout later.
Read more of the special section, “The Sandwich Generation,” and share your thoughts in the comments section.
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