Last year, the world's only Titanic survivor faced a quandary. Millvina Dean was only two months old when the great ship sunk, in 2008 she was in her mid-nineties and needed money to pay for a nursing home to live out the rest of her days in relative comfort. What to do?
Well, like many people the world over, Miss Dean took a long look at her assets - and decided to sell them. More precisely, she decided to sell the mementos she still had of the disaster, a suitcase full of clothes her family was given to help them begin a new life. The auction of the wicker case and clothes, along with rare prints of the ocean liner and letters her mother received from the Titanic Relief Fund, raised almost $54,000 - ten times more than she thought it would.
It's official: getting old is expensive. If you are lucky enough to live a long life, chances are you'll eventually be paying for it by the nose. Many people end up having to finance their own care near the end of their days, and it can cost a fortune. In fact, the New York Times reckons that an independent-living facility can cost up to $9,000 a month - that's about what a a New York penthouse could cost!
If you are looking into a nursing home - defined as a home that provides 24/7 care as well as administers medicines and even some medical procedures - for you or a loved one, here are some ways to pay...
Reverse Mortgage. This is a mortgage that allows homeowners to convert part of their assets into cash. Kind of like a home equity loan. Ask for professional advice if you are interested in going down this route, and only deal with a reputable lender. Be aware that the loan must be paid in full if you fail to have the home as your primary residence for one year or more, ie, if you stay in a nursing home for more than 12 months.
Long-Term Care Insurance. Most people do not have this type of insurance, but it can be very helpful if you do. The earlier you start to pay the more you will accrue - and the less you will pay initially. It is advised to take this route only to avoid burdening family members with bills for your care, and not if paying the premiums could become insurmountable. And remember you will not be sold a policy if you already have a health condition such as Parkinson's Disease or Alzheimer's.
Medicare or Medicaid. It's estimated that about 45 percent of all spending on long-term health care is covered by Medicaid, while about 11 percent is covered by Medicare and Social Security. The rest is paid for by the individual, by and large. Medicaid is both federal and state funded, and there are strict rules regarding who qualifies.
Win the Lottery. What could be better? Don't forget you need to buy a ticket first. And keep in mind that statistically, you have a better chance of walking up to a complete stranger and correctly guessing their telephone number than you have of winning any lottery at all. Still, every week there are winners!
繚Inherit a Fortune. Easy and simple, this is a fantastic way to afford a nursing home - as well as a new Porsche, a vacation in the Bahamas and a college education for all the grandkids. Great if you can get it. Most of us can't - even if we hire a treasure hunter to find out if we are a long-lost heir to some incredibly rich dead soul.
Check Into a Veterans' Nursing Home. In theory, all veterans should have a place waiting for them when they need it. In practice, so many people need places that people on the lowest incomes usually get first priority. Check to see if you qualify before counting on this option.
Get Help from Other Family Members. Often family members will club together and pay what they can to insure that their parents or aging relatives are cared for when they need it most. Unfortunately, in many case family members simply don't have the funds - or have them earmarked for other priorities, such as Junior's college fund and Barb's new house in the 'burbs. Don't make the mistake of expecting a cash gift - you may be greatly disappointed. It's better to have an open talk in advance to learn whether any funds will be forthcoming, however uncomfortable this may be.
Top Tips for Paying for Care
Affordable long-term care will be a priority for many of us, but protecting our assets and savings should be a top priority as well. Here are some tips to do just that...
Don't give away all your assets. Remember the government can look back five years - if you gave away money that could make you ineligible to receive Medicaid for a period of time.
Avoid what is known as "spousal impoverishment," when the spouse who is left at home can also be left destitute as his or her assets are used to pay for the other person's nursing home care. You are allowed to opt out of having your assets count against you.
Read the fine print. It may sound like a fab idea to have a home equity loan or the equivalent, but know what you are getting into before you sign on the dotted line.
Hire a good, honest lawyer - if you can find one. Someone who specializes in Elder Law will be your best bet, as he or she will have years of experience in this type of thing.
Sadly, Millvina Dean died this May at the ripe old age of 97, in a private nursing home in the town of Ashurst, Hampshire in England. As the last survivor of the Titanic, her death was a memorable event. Three years earlier she had broken her hip and needed specialist care, and the sale of her historical memorabilia helped her through the most difficult times. We should all be so lucky!
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