The NCPC publishes periodic articles under the title "Planning for Eldercare". Each article is written to help families recognize the need for long term care planning and to help implement that planning. All elderly people, regardless of current health, should have a long term care plan. Learn More...
From its inception, the goal of the National Care Planning Council has been to educate the public on the importance of planning for long term care. With that goal in mind, we have created the largest and most comprehensive source of long term care planning material available anywhere. This material -- "Guide to Long Term Care Planning" -- is free to the public for downloading and printing on all of our web sites. Learn More...
In our series of articles we use the terms "aging seniors" and "final years of life" and "final years" frequently. For our purposes, an aging senior is facing his or her remaining years of life. Perhaps because of frailty or poor health or simply advanced age, this person is anticipating the end-of-life. An aging senior is no longer climbing the hill of life but has reached the pinnacle and is looking down the other side.
The terms aging senior and final years of life are significant to the type of planning that we help people achieve through the providers on our website. When planning for aging seniors, aging specialists are no longer interested in accumulating wealth or planning for retirement lifestyles in senior retirement communities. Planners for aging seniors are interested at this point in preserving what assets are left and possibly even passing them on to the next generation. Aging seniors are concerned about reducing debt and maintaining adequate income. Aging seniors and their families are concerned about the need for long term care and the interaction of family members in providing that care. Or, the family is concerned about finding a living arrangement that provides care support and supervision. Family and their loved ones are concerned about proper legal documents for the final years and for preparations for the end-of-life such as death, funerals and burials. Aging seniors and their families are very much concerned about health issues and medical treatment and government programs to support health care and long term care.
Here are some of the factors that we use to define the final years and when somebody becomes an aging senior.
Health can decline over time or a sudden change in health can occur due to an acute condition such as a heart attack, stroke or fall resulting in an injury. Many of these acute healthcare issues eventually resolve themselves and the senior is back on track leading an active and productive life. On the other hand, the acute event can lead to a permanent change in health and a change in the future perspective of a senior.
Health that deteriorates over time generally does not improve and often gets worse. At some point, this almost always results in disability and eventually death. Again, this change in lifestyle causes the senior to dwell on personal needs and limits the activity of that senior. At this point we would again call this person an "aging senior."
Frailty is an inherent symptom of old age. A person of this age is considered an aging senior and is in need of planning if the planning has not already been done.
An increased reliance on others is typically a reflection of poor health, disability or dementia. An individual who has reached this stage in life is once again someone we consider an aging senior and family or others should be helping this person prepare for the final years.
Anyone exhibiting symptoms of dementia, is considered an aging senior regardless of age. Even though some people may live a number of years with dementia, the condition often shortens lifespan, and that person is definitely living out his or her final years. Alzheimer's, in particular is a death sentence. If there are indications of dementia or even if dementia is full-blown, planning should be initiated immediately to lessen the burden, not only on the person suffering from dementia but planning should also be done to lessen the burden on the family and on the finances. Below is a list of issues that need to be considered by family members or other ones watching over aging seniors for which planning should be done or should be initiated.
For purposes of this article, we will define a senior as an individual age 65 and older. This is in keeping with a definition that is maintained by government and private organizations. In reality, this age definition is totally arbitrary and actually dates back to the time of Otto von Bismarck in the 19th century. Bismarck was Chancellor of the German Empire in the late 1800s and instituted many social reforms supporting workers such as health care and a form of social security. The initial government retirement income age in Germany was age 70 but the German government reduced that to age 65 in 1916. When the United States instituted Social Security in 1936 under President Roosevelt, the precedent of using age 65 had been established with the German system as a model and with many domestic retirement programs. This arbitrary age has been continued as the precedent for one graduating from being a worker to one who is retired. Most retired individuals 65 and older are referred to as seniors.
As Americans continue to live longer and longer, becoming a senior at age 65 is no longer considered a major watershed in a person's life. Many people are continuing to work beyond age 65 because they are healthy and productive and do not wish to spend the rest of their lives watching television at home or playing golf or traveling. However, at some point, the aging process catches up with all of us. For a few of us it occurs well before the age of 65, but many of us can remain healthy and productive well into our 80s and even 90s.
The point at which the aging process catches up is a point where we at the National Care Planning Council have coined the term "aging senior." This is a point where a noticeable change starts to occur. The senior may become more frail or he or she may have developed health problems or he or she is becoming more dependent upon family and friends for support or dementia might be rearing its ugly head. This process may occur for most people later in life and it is often accompanied by a lack of financial resources for a number of reasons.
Having helped seniors for many years, at the National Care Planning Council we find that generally most seniors fail to prepare for this phase of their life. We call this phase the final years. For many seniors this is the time prior to their death that they are struggling to keep their heads above water both physically and financially. Health care costs are rising, savings are being depleted and income is not keeping pace with inflation.
For whatever reason, aging seniors themselves and typically their families try to ignore the need for seeking advice and for planning for final years. It is usually a crisis such as a fall, the inability to pay for services or medical care, hospitalization or sudden illness or some other precipitating event that results in action being taken. Unfortunately, by this time it is often too late to do anything about the eventual outcome. Assets are already depleted; interventions have not been pursued and the family is not ready to accept responsibility for oversight and care. Even at this stage, planning assistance with this crisis is readily available. We hope that you are reading this article because you want to prepare in advance for the final years and you are not in a crisis planning mode. Nevertheless, even if you are in a crisis planning mode the National Care Planning Council can direct you to someone who can help you.
Some folks start their senior years with a significant amount of savings and investments and others not so much. Those who have little in savings and investments are particularly vulnerable to unexpected costs that may arise. But there is also a problem for those who have been successful in setting aside some extra money. Because people are living so long, they often outlive their savings and investments. What this means is that along the way to becoming older at age 85 or age 90 or age 95, expenditures have eaten into savings and investments.
It's not always withdrawals to create extra income that deplete the accounts. Perhaps there were unseen medical bills. Perhaps there was a major repair to the home that was not anticipated. Perhaps there was a divorce and a splitting of assets which is not so uncommon with senior couples today. In today's modern society, we often see the children coming back and asking for financial help or moving in because they have no money. Perhaps the savings and investment returns that were anticipated didn't materialize and the accounts did not grow to keep pace. Perhaps the income stream during the senior years did not grow as fast as inflation and savings and investments were raided to augment income. Or perhaps the plan was deliberate to use savings to augment income but savings and investment growth were anemic.
Even in the face of dwindling savings and investments, there are some strategies that can help to stabilize or even reverse the depleted accounts. You can use the resources on this website from the National Care Planning Council for assistance in this area.
We have already touched on issues that might result in inadequate income. One of these has been mentioned. If a senior or a senior couple is relying on investments and savings to augment income such as Social Security or pensions, and for various reasons those retirement accounts did not produce the anticipated results, many seniors find themselves in a bind in later years where because of weakness or disability they can't seek employment to make up the inadequate income.
There are also other reasons that the income might not be keeping pace. A major reason for many seniors nowadays is the accumulation of debt, particularly credit cards. For whatever reason, banks have been particularly liberal about issuing credit cards to older individuals who may not have the capacity to service that debt. The debt may have been necessary because of a major repair to the home, or due to unforeseen high medical bills or because of a bad investment due to financial fraud. These types of investments seem to be more prevalent among seniors. Paying for this debt reduces income that should be available to maintain the standard of living.
Another major factor for inadequate income could be that the income flow from year-to-year is not keeping pace with inflation. This is particularly true for seniors on Social Security or fixed pensions who must pay for the high cost of medical care. The cost of medical care has been increasing significantly faster than the yearly increases in Social Security. Also, in some areas the cost of maintaining a household due to higher utility bills, higher taxes and higher maintenance costs has risen faster than the cost of living increases in Social Security income.
Health can deteriorate over time or a change in health can occur suddenly. Sudden unexpected changes in health might be a diagnosis of cancer or it might be a heart attack or a stroke or some other acute health issue.
Health that has deteriorated over time will eventually result in disability – the inability of the senior to care for his or her own physical needs. This disability will then result in someone acting as a caregiver to assist in such things as dressing, bathing, toileting, ambulating, needing help with incontinence, preparing meals, answering the phone, paying bills, shopping, running errands and so on. This need for a caregiver usually requires making some major decisions for the remainder of the period in which the care is needed. Generally, chronic health failure over a period of time is not going to improve and will only get worse, resulting in a greater need for caregiving.
Acute changes in health can also lead to disability and the need for a caregiver. However, often the senior recovers and the disability disappears. On the other hand, sometimes the acute healthcare issue results in permanent disability and a permanent need for care.
A worsening of health for a senior – especially a senior of advanced age – will typically trigger the need for intervention and the need for making some serious decisions about living arrangements, costs, government support and family support.
Seniors can lose their independence simply because of advanced age and a general weakness and frailty – requiring intervention and support from other people. However, the most common cause of losing independence is dementia. The risk of dementia or a loss of cognitive capacity increases considerably as one grows older. For aged seniors who are age 80 and above, the risk of dementia is almost 50%. This means that almost half of all aged seniors are experiencing some form of cognitive impairment.
Families often wait too long before intervening to assist the aged senior to maintain independence. Perhaps it is because the family is in denial or perhaps it is because they hope it will go away or perhaps it is for some other reason. As part of the planning process, all families should anticipate the contingency of their loved ones losing their independence and should be ready to step in at the appropriate time.
As one grows older, there is a tendency to be more trusting and thus more vulnerable to financial exploitation. We don't need statistics to prove that – we simply know from experience tthis is true.
Financial exploitation can take several forms. For example, many seniors will hire handymen or mechanics or other service providers to help them with their maintenance, repair, or remodeling needs. Unscrupulous maintenance or repair providers sometimes take advantage of seniors by providing services that are unnecessary and these people will charge more for those services than they otherwise would have. Additionally, as a result of of the many exposés on television, all of us are aware of phone scams and Internet scams that take advantage of seniors and rob them of their savings. Finally, some financial services practitioners will sell financial products, financial services or investments to seniors that are not suitable for them and that may result in losses or the inability to access their funds.
It is crucial for family and friends to become aware of this tendency for financial exploitation and to develop strategies to protect senior loved ones from it.