How to Prepare for Old Age When You Don’t Have Children
In general, if you have children, you have someone to look after you after your golden years. However, not everyone has children, and if you don’t, you need to prepare yourself to care for the elderly. And this is important to plan now.
This does not mean that having a child automatically guarantees that you will be taken care of in old age, but adult children usually take care of elderly parents. If you don’t have children, you should be more prepared to figure it out on your own, and here are the basics of what you should have in place.
Find someone you trust to look after your health
As you age, you are likely to be concerned not only with money, but also with your health. Who will take care of you? Who will make medical decisions for you if you cannot make them yourself?
The health directives ensure that you have clear answers to these questions, and it is important to establish them now, even if you are young and healthy . They consist of two main things: a will and a health care power of attorney .
A will determines what kind of health care you want to receive under certain conditions. It includes requests to stop life support and any other help that only prolongs the process of your death. FindLaw has an example of living will that gives an idea of what it includes.
The Life of Probate guidelines vary from state to state , but there are online tools to guide you through the process. For example, LegalZoom here breaks it down into three easy steps .
Your will also includes a health care power of attorney or health care power of attorney. This is the one who will make decisions about your health care that are not covered by your life will. They also need to look after your mental and physical health, and they are the ones who decide when it’s time for you to change your living conditions and move into a nursing home. If you don’t have children, you can think of a spouse or partner, but things don’t always work out so neatly. You may be divorced in old age or outlived your spouse. So it’s important to schedule a backup just in case and you want to update your directives accordingly.
When you don’t have children, it can be difficult to find someone for this role. Ideally, you have a trusted friend or relative you can recruit, but if you don’t have one, there are options. For example, if you set up a trust with a financial institution, you can write it so that they also monitor your physical and mental health. It sounds dubious, but Kiplinger explains how this process works :
The document, for example, may recommend that the trust company hire an aged care manager to conduct periodic assessments in the future, and send a copy of the assessment to the person you choose as your healthcare agent.
A big plus for banking use: “If you specify an institutional guardian, the likelihood of elder abuse is reduced,” says Shankman. “The vast majority of elder abuse is committed by family members.”
Or, you can appoint a lawyer to act as a proxy for your health care provider. US News suggests:
If no one comes to mind, hire an attorney specializing in aged care law by asking around for referrals or searching the Internet for highly rated professionals. Unlike your friends, they are protective and well versed in caring for the elderly. In most cases, Rahl found, “they are trustworthy and will do a good job for you.”
Again, when you go to an agency or attorney, you need to be sure to find a reputable attorney . The National Academy of Advocates for the Elderly has its own database of lawyers specializing in the field of the rights of older people and the rights of persons with special needs .
Find out who will manage your finances
Power of attorney is an important part of estate planning. Most people think that real estate planning is for seniors only, but as we told you before, it’s never too early to get started . A power of attorney is the person who will manage your finances, including any legal issues, bills or taxes that you are unable to handle on your own. Obviously, this should be someone you trust . If you do not have children, you can assign another close family member or friend — perhaps a spouse, niece, nephew, cousin, or brother or sister. If that’s not an option, Kiplinger suggests the following :
If you don’t have someone reliable … you could create a revocable trust and appoint a bank or trust company as a trustee, says Martin Shankman, estate planning attorney in Paramus, NJ. the company will ultimately take on the financial tasks that you entrust to it, including paying bills and guardians, processing medical claims, and monitoring your home if you are hospitalized or in a nursing facility.
They add that it is important to develop a system of checks and balances, whether you delegate a person or a bank to take care of your finances. This could mean, for example, asking for your power of attorney to send monthly reports to an accountant. The idea is to simply provide transparency so that everyone involved with your finances knows what is going on and acts in your best interest .
There are several different types of powers of attorney, but most experts recommend ” long-term” powers of attorney . It is valid from the moment the documents are signed until your death, and it is easy to issue it yourself. RocketLawyer helps you get started with the right shape , depending on your condition. You provide specific details about when this person also has control over your finances. If you plan to designate an institution to handle your finances, you should consult with an inheritance attorney or trustee in such situations. The American Association of Individual Investors provides several guidelines to help you find a reputable real estate attorney .
You can also change the power of attorney over the course of your life. Maybe you vse-taki will have children – you can always revoke your old document and create a new one.
Write a will to protect your assets and last wishes
If you have no children and little money, you may not think that you need a will and testament . But the will doesn’t just establish who gets your belongings when you die. He also determines who will fulfill your last wishes, will become the guardian of any pets and in general will take care of everything that you leave behind.
If you are low on assets or property, you probably just need a simple will and you can draw up a basic one using tools like Willing , LegalZoom, or RocketLawyer . You detail your wishes, name all the beneficiaries (people who receive your things) and appoint an executor (the person who fulfills your will). If you don’t have children, this should be someone you trust, or again, a third party institution like a bank. If you have a partner or are married, you can make a beloved will with your spouse . This basically leaves everything to each other, but also describes what happens to your property and assets after you both get through. A free tool like Willing helps you take care of all of this and walks you through the entire process.
You will print the will, ask several witnesses to sign it, and then keep it in a safe place (and let your executor know where it is). According to Nolo’s legal website , this is really all you need to do to draw up a legally binding will.
Expect Huge Long Term Treatment Costs
When most people think about saving for retirement, they think about vacation. You save money for the beach or for leisurely dinners. In fact, you will be using your retirement savings to pay for less attractive things like healthcare costs.
And care for the elderly (more commonly known as long-term care) is expensive. Here you can see how costs vary from state to state, but in general you can count on thousands per month. According to the US Department of Health and Human Services , the average cost of a boarding school is $ 3,293 per month . The nursing home, which provides even more services, costs $ 6,235 a month, or nearly $ 75,000 a year. Even if you are not in a hospital, the average cost of long-term care can be:
- $ 21 an hour for a home health assistant
- $ 19 an hour forhousewife services
- $ 67 per day for adult day care services
An adult child may have the resources to help an aging parent with these costs. When you don’t have children, that’s one less insurance. Your standard health insurance does not cover long-term care, whether it is a nursing home or a family health care provider, and Medicare and Medicaid may be restrictive.
If you cannot afford long-term care yourself and are not eligible for Medicare, you may need long-term care insurance. This policy works just like any other insurance policy: you pay an insurance premium and it ensures that you are covered when you need an assisted living. However, it comes with a hefty premium of several thousand dollars a year , depending on your age. Thus, you want to fully consider other options , such as saving early in the health savings account .
Long-term care insurance has its fair share of critics , but in some cases it is the best option. If you don’t have a ton of money to pay for the hefty cost of long-term care each year, and you are not eligible for Medicaid, most experts agree that insurance is worth it .
You can check if your employer offers this option (and many do it with a group discount). As with life insurance, you register through your employer, but your policy usually remains valid even if you leave or retire. You can also search the American Association for Long Term Medical Insurance (AALTCI) database for options to start your search. Buying long term care insurance is a separate article, but AALTCI is, in general, a reliable resource to navigate the process when you’re ready to start. On any insurance policy, you will want to read your explanation of benefits and make sure you know what is covered.
Your options will vary, but the bottom line is that the sooner you factor these huge costs into your retirement plan, the better. This applies to all of us, but it’s especially important if you don’t have kids because you have fewer options to rely on.
Find a comfortable place to live and create a support system
You also need to consider your geographic location. For example, the New York Times described one single woman preparing for old age without children:
So she planned it carefully. A federal retiree who now works for the state government, she moved to New York specifically because it had good public transportation, affordable cultural activities, and good health care. “I wouldn’t want to be in the suburbs or in the countryside if I couldn’t drive,” she explained.
The Milken Institute’s Center for Future Aging compiles a list of communities across the country that they consider to be “thebest cities for successful aging”. You can also see the ranking of individual cities and metropolitan areas. To make their list, they look at hospitals that offer geriatric services, nearby retirement housing options, ease of transportation, and more. You can check out their full methodology here .
Wherever you live, you need to make sure you have a reliable support team of friends, neighbors, and loved ones to help you as you age. It certainly takes time, but from a logistics standpoint, you at least want a group of people to handle your health finances and directives. Specifically, experts recommend that you have at least an accountant, financial planner, and estate planning lawyer (or an older lawyer) working for you.
You also want your support group to know when it is time for you to hire a healthcare professional or move into a residential community. Unfortunately, sometimes this happens on its own – an elderly person gets lost or has an accident at home, and a loved one understands that it is time to establish more practical assistance. It is important to tell your support system when you want this level of help as you age.
When you’re young, none of this seems like a priority. Even if you have adult children, it helps to prepare as much as possible for these years, because it can be a heavy burden. When you don’t have children, it’s even more important to understand exactly what needs to be in place to prepare for your older years.