Learn About Long Term Care Options From
Massachusetts Mutual Life Insurance Company
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Where do you picture yourself in retirement? A condo complex by the ocean, someplace where it’s warm all year? A small apartment in a big city, steps away from museums and restaurants? Or maybe you just want to stay in the community you’ve lived in all your life, close to friends and family.
There are a whole lot of factors that go into choosing a place to retire. It’s a balancing act between what you want, what you can afford and what’s practical for your lifestyle — not to mention what your spouse or partner may want. So it’s important to start thinking about the possibilities sooner rather than later.
Two Key Considerations for Choosing Where to Retire
You probably already know that the cost of living is a big consideration when you’re thinking about where to retire. Housing, insurance, taxes and other basic expenses can vary dramatically from place to place within the United States and around the world.
What you may not have given a lot of thought to yet, is the cost of long term care in the location you hope to retire — specifically, the price of assisted living and nursing home facilities, adult day care, home health aide services, etc.
What Does Long Term Care Have to Do with It?
It’s not easy to think that you or your spouse may need long term care for any period of time during retirement, whether due to illness, injury or a cognitive impairment like Alzheimer’s disease. Not factoring this potential expense into your retirement decisions is a gamble.
Something else to think about is that there’s a vast difference between long term care costs in various parts of the country. Nursing home stays in an expensive state like Massachusetts can cost more than double what they do in a less expensive state like Louisiana1.
For instance in 2014, the average cost of one day in a nursing home in Louisiana, with a private room, was $161. In Massachusetts, it was $3681. The discrepancy between home health aide costs can also vary widely between regions — and isn’t necessarily a more affordable option.
On the other hand, money isn’t everything. There’s also quality of care to consider. Your living expenses and long term-care costs in the vicinity of a large city, for example, might be higher, but you have a wider variety of services and facilities to choose from. And you’re closer to medical specialists and world-class hospitals if you need them.
Where your family and friends live is another factor. You may want your family members to play an active role in managing your long term care, or vice versa. Being at the country’s premier assisted living facility may not be worth it if your kids and grandkids are thousands of miles away.
The Balancing Act
With all these considerations to keep in mind — cost, quality of care and quality of life — what are your best options? First, take stock of your financial picture — your savings, your assets, your income and how much you can expect to receive from Social Security. Then take a careful look at the cost of living and the cost of long term care in the locations you’d consider living in during retirement.
Given your retirement savings and income, which of your potential retirement destinations is and isn’t realistic? If you or your spouse needed to spend a year or more in a nursing home, or if you needed to transition more permanently into an assisted living facility, how would it affect your overall financial picture?
If the numbers aren’t adding up, you may need to adjust some of your expectations and plans. Cast a wider net in terms of potential places to live, or think about ways to scale back your future living expenses. Consider whether you can afford to save more for retirement now. And, ask yourself what trade-offs you would be willing to make should you ever need long term care: would you be comfortable in a basic nursing facility if it meant you could live in a more desirable and expensive area that’s closer to your family and friends?
You might also look into insurance products that offer long term care benefits. These products can help you cover your expenses and protect your assets from being used to pay for care, should the need arise.
The Right Place is Out There.
For many people, retirement is an opportunity to live in the kind of place they’ve always dreamed of, but couldn’t do so while working or raising a family. With a little bit of advance planning and careful research, you can set your sights on a living situation that strikes the right balance between cost of living, cost of long term care, and lifestyle, for a secure and satisfying retirement.