Astro Findings
As many of us engage the aging process, we move through it with little or no thought until, we or our loved ones, hit our senior years. Then, playing the aging game can surprise us with all kinds of issues that may spring up suddenly and without any warning. Senior Living
One of those subtle surprises occurs when you or an aging parents or relative may be considering entering an assisted living center. Fortunately, there are many assisted living choices today, but each choice can impact lifestyle and care levels.
By using some fundamental awareness and planning strategies, seniors can achieve and maintain a desirable lifestyle. And it is wise to begin thinking about and plan for those years is now.
Any big change in lifestyle, such as moving into an assisted living community or facility, requires a huge emotional adjustment. Most common, there is fear and uncertainty because of declining independence and health.
In addition, there are factors such as loss of possessions, access to friends, loss of pets and even one’s perceived “home” privacy. How one faces and engages this process will no doubt be unique to each individual’s situation.
People, personal beliefs, economics and health all drive the decision process. More than 12 million people are facing these issues right now and more than 65 million will confront these retirement issues by 2030.
Is this the right time?
Timing is usually driven by circumstances. Every person must carefully determine what type of living arrangement is best. If you can stay home and get the needed care, then stay home. If specialized care is needed and unavailable through home services, then new arrangements will be necessary. If you simply want a place that requires less work and maintenance, then a whole set of options are available. Retirement communities
Seniors & Families: Joint Partners in the Process
Any decision about senior living, whether it’s your own personal drama or help for an aging parent, requires good communication. All dimensions of the decision must be openly considered including support, timing, finances, responsibilities and personal choices. Good listening skills are critical to avoid damaging confrontations or misinterpreted intentions/motivations.
Stick with the Basics is a Good Starting Point
Nothing is certain in every circumstance but most seniors consider the first issue to resolve is geographic. What are the constraints? Where is the best possible place to live all things considered? The decision could be driven by weather, a place you have always dreamed about, proximity to family or financial conditions. When this point is decided, many subsequent issues begin to be clear.
Next one must be clear about services and care requirements. What about meals, transportation, personal health, mobility, dressing, bathing and social expectations?
All of these issues must be evaluated in the context of current and anticipated financial resources. Establish a budget. What is reasonable? Be realistic about costs and unexpected events. Is financial independence likely or will assistance be needed? If so, who and how will it be supplied? Senior Life
There are more than 650 groups across the country organized to assist seniors and their caregivers. They can offer planning, counseling, and many provide in-home and community services. These are highly valuable resources.
In addition, consider the following sources:
Because We Care: A Guide for People Who Care. This is a helpful guide offering quality information and recommendations covering all aspects of care giving. The online version of this guide contains links to outside resources, making it especially useful. http://www.aoa.gov/wecare/default.html
FirstGov for Seniors
This is the federal government’s gateway to all its publications of interest to seniors, caregivers and family members. http://www.seniors.gov/.
National Council on Aging Benefits Checkup
A free service assisting seniors and their families locate state and federal assistance programs. http://www.benefitscheckup.org/.
A Recommendation:
Don’t rush into anything, but don’t wait until the issues is staring you in the face and time is no longer on your side. Take the time to think through your preferences and expectations and communicate them to your key supporters.
If you are caring for senior parents, take the lead and begin an honest dialogue about these issues. This will minimize surprises and ensure a smoother outcome for everyone.
For more than 20 years, Karl Edmunds has been a noted author within the business and management consulting arena. As a senior, he now engages his curiosity and observations about life to write about key issues of importance to the growing community of seniors (Boomers), and the value of living life to the fullest every single day. Give me your comments and suggests at http://SeniorRetirementTrends.org To participate as an author go to: http://www.seniorretirementtrends.org/authors/article-submission/
Tags: Boomers, Estate Plannning, Retirement, senior living, seniors
Posted in Retirement · March 14th, 2010 · Comments (0)
If you are a senior and you haven’t had the frequent sales pitches for retirement annuities, you must be living on some deserted island. On the surface, annuities seem to be the perfect retirement tool for aging seniors. So what aspects of an annuity should you scrutinize very carefully if you are considering a purchase? Retirement Plans
Simple: Taxes and expenses.
Just because you have heard the term “annuity”, don’t assume you fully understand it.
What Is an Annuity?
An annuity is a retirement plan product usually offered by insurance or brokerage firms. There are two basic types with some variations and sold under different names:
• Fixed annuities pay a set rate of interest for a set number of years, and
• Variable annuities allow for investment into an array of accounts that resemble mutual funds.
You have the option to buy an annuity with a lump sum payment today or make premium payments over time.
Annuities are purchased with after tax dollars but all growth is tax deferred until the time of withdrawal.
You will face a 10% penalty plus the taxes due if you begin to withdraw money before the age of 59 ½ but you are not compelled to begin withdrawing funds at age 70 ½ like other investment options.
Now for the tricky part.
People that sell annuities get paid for all of kinds of income and death benefit guarantees built into the offering. These guarantees or payments force the cost or expenses of the annuity to be extreme when compared to traditional investments such as mutual funds. For example, in 2005, Morningstar pegged the average annuity’s annual expense rate at 2.35%, well above the average mutual fund rate of 1.44%.
This expense differential alone destroys almost any tax advantage that most investors might gain by owning an annuity instead of simply investing in taxable mutual funds.
Additional expenses, in the form of extraordinary surrender charges must also be considered in the overall evaluation. If there is a potential that you may change your mind and want out in the early years of the agreement, you could face a fairly common charge of 5% to 7%.
What are the Advantages of an Annuity? Estate Plans
If you have maxed out your contributions to other types of retirement plans, an annuity may be a good consideration.
An annuity can be a shelter for investments during a bankruptcy or a tool to avoid probate in some circumstances. And it is a wonderful investment for anyone that simply wants a lifetime income guarantee without any further thought.
Now What? Retirement Trends
The ultimate goal for a successful retirement is to have the funds needed to sustain your lifestyle. Some investment strategies have the potential for higher returns but can’t assure you that your funds will last throughout your life. If this threat stands at the top of the list of your retirement concerns, then an annuity may be the perfect product for your retirement plan.
Talk to an advisor that is not biased by the personal financial awards associated with any retirement product.
For more than 20 years, Karl Edmunds has been a noted author within the business and management consulting arena. As a senior, he now engages his curiosity and observations about life to write about key issues of importance to the growing community of seniors (Boomers), and the value of living life to the fullest every single day. Give me your comments and suggests at http://SeniorRetirementTrends.org
Tags: Annuities, estate planning, legacy planning, Retirement, seniors
Posted in Retirement · March 13th, 2010 · Comments (0)