Paying for Nursing Home Costs: A Guide to Medicare, Medicaid and More

Navigating the myriad of ways to pay for nursing home care can be overwhelming. However, with a clear understanding of nursing home costs and the options available, it becomes manageable.

Understanding Nursing Home Costs

Nursing home costs nationwide can be daunting. In 2021, a semi-private room in a nursing home averaged $7,908 per month, with private rooms at $9,034. Even assisted living facilities, which offer a lesser level of care than nursing homes, can run upwards of $4,500 a month. Most people who enter nursing homes start by paying for their care out-of-pocket by using their savings or accessing equity from large assets like real estate. It’s clear that understanding these costs is crucial for anyone considering nursing home care.

What are the Nursing Home Care Private Pay Options?

Private pay remains a choice for those who either don’t qualify for Medicaid or prefer not to use it. This method involves tapping into personal assets or savings to pay for nursing home care. It provides more flexibility in terms of choosing the facility or level of care. However, it can quickly deplete one’s assets.

Does Medicare Pay for Nursing Home Costs?

Medicare is a federal program and primarily focuses on medical care, not long-term care. Medicare will not pay for long-term care in a nursing home facility. It will pay for a limited amount of time for skilled nursing care following a hospital stay but not for extended nursing home stays. Seniors also still need Medicare coverage for hospital care, doctor services and medical supplies while living in the nursing home. Understanding the specifics of what Medicare covers can help families plan better.

What kind of nursing home care does Medicare cover? Medicare primarily covers skilled care, which is care that can only be delivered by trained professionals. It doesn’t typically cover custodial care, which is personal care, like bathing or dressing.
How much does Medicare pay for skilled nursing home care? Medicare will cover the first 20 days of skilled nursing care at 100%. Beyond that, up to 100 days, a co-payment is required. After 100 days, Medicare will no longer pay for skilled nursing care.

Using Medicaid to Pay for Nursing Care

Medicaid is a popular option for many seniors needing nursing home care. It caters to those with limited income and assets. It is the primary payer for long-term care coverage nationwide.

Who’s eligible for Medicaid nursing home coverage? Medicaid is a joint federal and state-run program. Eligibility varies by state but generally requires meeting specific income and asset limits. Most states also have a look-back period of five years to ensure that assets weren’t sold or given away to qualify for Medicaid.
How does one apply for Medicaid, and what does Medicaid cover? Applying requires detailed financial documentation. Medicaid can cover a large portion of nursing home care costs. However, it might limit the choices of facilities. Working with an experienced elder law attorney to apply for Medicaid is not required. However, it can increase your chances of success by providing guidance, ensuring accurate documentation, and addressing any issues or appeals that may arise.
Do all nursing homes accept Medicaid? Not all nursing homes accept Medicaid. It’s essential to research and find facilities that both provide the level of care needed and accept Medicaid as a payment option.

Long-Term Care Insurance: Is It Worth It?

Long-term care insurance is designed to cover long-term care costs that Medicare and private health insurance don’t cover. This might include nursing home care, assisted living, or home care. However, the coverage depends on the policy details, and premiums can be high. In addition, the older one is, the harder it is to be considered insurable.

If long-term care insurance is an option, be sure to start planning early. Insurance companies are known to reject more applicants the older they get. Reviewing insurance plans each year to ensure that the policy still meets anticipated needs is essential. Make changes if necessary, and never stop paying the premiums so that the insurance does not lapse.

The Role of VA Nursing Homes in Elder Care

For veterans, VA nursing homes can be an option. These facilities are dedicated to providing care to veterans and may be more affordable than private facilities.

Making the Right Decision: Private Pay vs. Medicaid vs. Medicare

The decision often comes down to personal finances, care needs and eligibility. Understanding the differences between these payment methods can lead to more informed choices. As the demand for senior care services grows, it’s predicted that the cost of nursing home care will continue to rise. Planning ahead becomes even more essential.

Working with an Elder Law Attorney: The Best Way Forward

Consulting with an elder law attorney can provide invaluable insights and assistance in navigating the complexities of nursing home costs and payment options.

Planning ahead is crucial. The more you know, the better decisions you can make for yourself or your loved ones.

Do I Need All Insurance after 65?

Seniors should be cautious about canceling their insurance policies. Consider your future insurability and your individual circumstances and life goals. There’s no one answer that fits everyone.

The primary purpose of life insurance is to replace lost income. Retirees may still want to keep their coverage because it can be an important tool in wealth transfer to the next generation.

US News’ recent article entitled “The Only Insurance Policies You Need After Retirement” advises that these guidelines can help determine which policies are essential and which could be a waste of money. Let’s look at how to decide which policies you need and which you can skip after age 65.

Must-Have Policies for Seniors. These two types of insurance are necessary for seniors.

Medical Insurance. The increasing cost of health care that comes with advanced age is a big reason to buy medical insurance. The Affordable Care Act requires everyone to maintain coverage. Most seniors 65+ are eligible for Medicare, and those still working may have benefits through their job. Note that Medicare doesn’t cover all medical costs, so look at buying a supplemental plan, such as Medigap and Part D coverage, to help pay for services not fully covered by Original Medicare. A Medicare Advantage Plan offered by private insurers is another way to fill in coverage gaps.
Homeowners or Renters Insurance. Seniors with valuable jewelry or other items may need to add a rider to their policy to fully insure these possessions. Mortgage lenders require homeowners to maintain coverage, but once the loan is paid off, it’s not required. It may be tempting to save money by canceling the policy, but that could be a costly mistake. That’s because a big loss would have to be replaced with savings.

Some Smart Options. There are other types of insurance that could be helpful to seniors.

Travel Insurance. Those who plan to travel extensively may want to buy travel insurance. Find a policy that includes features, such as emergency medical and medical evacuation services along with trip delay or cancellation insurance.
Auto Insurance. Auto insurance is required in almost every state. Any senior who is still driving and owns a vehicle should insure it properly.
Umbrella Insurance. This insurance provides additional liability coverage above and beyond what’s included in homeowner and car insurance. Your volunteer activities could put you at risk for a liability claim and warrant added insurance coverage.
An immediate annuity can help guard against outliving savings by providing a guaranteed source of income. Annuities can be purchased for a lump sum amount and provide monthly payments that are based on a person’s age and the purchase price.
Long-Term Care Insurance. Medicare won’t pay for ongoing custodial care in a nursing home or assisted living facility, and Medicaid is only available after a person has depleted almost all their assets.

One Type of Insurance to Cancel. Seniors who aren’t working don’t have a need for disability insurance.

Reference: US News (Feb. 27, 2020) “The Only Insurance Policies You Need After Retirement”

Must I Sell Parent’s Home if They Move to a Nursing Facility?

If a parent is transferring to a nursing home, you may ask if her home must be sold.

It is common in a parent’s later years to have the parent and an adult child on the deed, with a line of credit on the house. As a result, there’s very little equity.

Seniors Matter’s recent article entitled “If my mom moves to a nursing home, does her home need to be sold?” says that if your mother has assets in her name, but not enough resources to pay for an extended nursing home stay, this can add another level of complexity.

If your mother has long-term care insurance or a life insurance policy with a nursing home rider, these can help cover the costs.

However, if your mom will rely on state aid, through Medicaid, she will need to qualify for coverage based on her income and assets.

Medicaid income and asset limits are low—and vary by state. Homes are usually excluded from the asset limits for qualification purposes. That is because most states’ Medicaid programs will not count a nursing home resident’s home as an asset when calculating an applicant’s eligibility for Medicaid, provided the resident intends to return home

However, a home may come into play later on because states eventually attempt to recover their costs of providing care. If a parent stays a year-and-a-half in a nursing home—the typical stay for women— when her home is sold, the state will make a claim for a share of the home’s sales proceeds.

Many seniors use an irrevocable trust to avoid this “asset recovery.”

Trusts can be expensive to create and require the help of an experienced elder law attorney. As a result, in some cases, this may not be an option. If there’s not enough equity left after the sale, some states also pursue other assets, such as bank accounts, to satisfy their nursing home expense claims.

An adult child selling the home right before the parent goes into a nursing home would also not avoid the state trying to recover its costs. This because Medicaid has a look-back period for asset transfers occurring within five years.

There are some exceptions. For example, if an adult child lived with their parent in the house as her caregiver prior to her being placed in a nursing home. However, there are other requirements.

Talk to elder law attorney on the best way to go, based on state law and other specific factors.

Reference: Seniors Matter (Feb. 25, 2022) “If my mom moves to a nursing home, does her home need to be sold?”

What are States Doing to Help Pay Long-Term Care Costs in Future?

Starting this year, workers in Washington state must pay 58 cents of every $100 they earn into the Washington Cares Fund. That money will help pay their long-term care costs in the future. Those with qualifying long-term care insurance can be eligible for an exemption.

Next Avenue’s recent article entitled “How Medicaid and Medicare Fit Into Planning for Long-Term Care” says that starting in 2025, those Washington residents who’ve paid in for at least three out of the prior six years, or for 10 years in total, will be able to withdraw up to $36,500 to pay for their costs of care. It is an effort by the state to fill in a major gap in our long-term care system. California has also enacted a law to bring down the eligibility threshold for Medicaid to totally eliminate it by the end of 2023. New York state is considering similar legislation.

Any senior may need assistance as they age, whether due to dementia, illness, loss of eyesight, or simple frailty. The level of assistance and how long it will last can vary greatly. However, few retirees have enough saved to pay for their care for very long out-of-pocket. According to research from Boston College, more than half of today’s 65-year-olds will need a medium to high level of assistance for more than a year. Almost two thirds of that care will be provided by family members – mostly children and spouses – for no cost, but more than a third will be provided by paid caregivers.

According to the Congressional Research Service, 43% of long-term care services are paid for by the Medicaid program, 20% by Medicare, 15% out-of-pocket and 9% by private insurance. The rest comes from a combination of private and public sources that includes charitable payments and VA benefits.

Medicare Coverage. This is the federal health insurance program for people beginning at age 65. Note that Medicare only covers so-called “skilled” needs following a hospitalization. It pays for up to 100 days of care in a skilled nursing facility following a hospitalization and longer term for home health services.However, the home health coverage is not comprehensive.

Medicaid Coverage. The financial rules for Medicaid coverage are complicated and state-specific. However, generally people must spend down to about $2,000 in savings and investments. Planning to use Medicaid to pay for long-term care is also complicated by the fact that while its coverage of nursing home care is comprehensive, its payment for home care and assisted living facility fees is only partial and differs both from state to state. Even if you may be able to leverage Medicaid to help pay home and assisted living care, you must also rely on your own savings.

Out-of-Pocket Costs. The low percentage of long-term care costs paid for out-of-pocket is surprising, in light of the vast growth of both assisted living and private home care agencies over the last several decades. However, this demonstrates the fact that most older adults have limited resources to pay for anything beyond their basic living expenses. When the need for care arises, they must rely on family members or Medicaid.

Insurance. A large component of insurance coverage of long-term care consists of Medicare supplemental insurance payments for skilled nursing facility copayments. While Medicare will pay for up to 100 days of skilled care following a hospitalization, it actually pays entirely for only the first 20 days. For days 21 through 100, there is a copayment which for most is paid by their MediGap insurance. As such, long-term care insurance pays for a very small share of long-term care costs. For those who have coverage, it can be terrific. However, due to its high cost, those who have it often also have the resources to pay for their care out-of-pocket, at least for some period of time.

Veterans Benefits. More vets are taking advantage of a Veterans Administration benefit known as Aid & Assistance that will provide veterans who qualify financially with up to $2,431 a month (in 2022) to help pay for their care.

Reference: Next Avenue (Feb. 2, 2022) `“How Medicaid and Medicare Fit Into Planning for Long-Term Care”

Talk to Parents about Estate Planning without Making It Awkward

If you don’t have this conversation with parents when they are able to share information and provide you with instructions, helping with their care if they become incapacitated or dealing with their estate after they pass will be far more difficult. None of this is easy, but there are some practical strategies shared in the article “How to Talk to Your Parents About Estate Planning” from The Balance.

Parents worry about children fighting over estates after they pass, but not having a “family meeting” to speak about estate planning increases the chance of this happening. In many cases, family conflicts lead to litigation, and everyone loses.

Start by including siblings. Including everyone creates an awareness of fairness because no one is being left out. A frank, open conversation including all of the heirs with parents can prevent or at least lessen the chances for arguments over what parents would have wanted. Distrust grows with secrets, so get everything out in the open.

When is the right time to have the conversation? There is no time like the present. Don’t wait for an emergency to occur—what most people do—but by then, it’s too late.

Estate planning includes preparing for issues of aging as well as property distribution after death. Health care power of attorney and financial power of attorney need to be prepared, so family members can be involved when a parent is incapacitated. An estate planning attorney will draft these documents as part of creating an estate plan.

The unpredictable events of 2020 and 2021 have made life’s fragile nature clear. Now is the time to sit down with family members and talk about the plans for the future. Do your parents have an estate plan? Are there plans for incapacity, including Long-Term Care insurance? If they needed to be moved to a long-term facility, how would the cost be covered?

Another reason to have this conversation with family now is your own retirement planning. The cost of caring for an ailing parent can derail even the best retirement plan in a matter of months.

Define roles among siblings. Who will serve as power of attorney and manage mom’s finances? Who will be the executor after death? Where are all of the necessary documents? If the last will and testament is locked in a safe deposit box and no one can gain access to it, how will the family manage to follow their parent’s wishes?

Find any old wills and see If trusts were established when children were young. If an estate plan was created years ago and the children are now adults, it’s likely all of the documents need to be revised. Review any trusts with an estate planning attorney. Those children who were protected by trusts so many years ago may now be ready to serve as executor, trustees, power of attorney or health care surrogate.

Usually, a complete understanding of the parent’s wishes and reasons behind their estate plan takes more than a single conversation. Some of the issues may require detailed discussion, or family members may need time to process the information. However, as long as the parents are living, the conversation should continue. Scheduling an annual family meeting, often with the family’s estate planning attorney present, can help everyone set long-term goals and foster healthy family relationships for multiple generations.

Reference: The Balance (Oct. 15, 2021) “How to Talk to Your Parents About Estate Planning”

How Do I Hire an Elder Law Attorney?

Elder law attorneys are lawyers who assist the elderly and their family members, and caregivers with legal questions and planning related to aging.

These attorneys frequently are called upon to assist with tax planning, disability planning, probate and the administration of an estate, nursing home placement, as well as a host of other legal issues, says Forbes’ recent article entitled “Hiring An Elder Law Attorney.”

In addition, there are some elder law attorneys who have the designation of Certified Elder Law Attorney (CELA), a certification issued by the National Elder Law Foundation. A Certified Elder Law Attorney must meet licensing and other requirements, including specific experience in elder law matters and continuing education in elder law. However, note that an elder law attorney does not need to have the CELA certification to be an experienced elder law attorney.

There are many elder law attorneys who specialize in Medicaid planning to help protect a senior’s financial assets, if they suffer from dementia or another debilitating illness that may require long-term care. Elder law attorneys also prepare estate documents, such as a durable power of attorney for health and medical needs and a living will. As you age, the legal issues that you, your spouse, and/or your family caregivers must address can also change.

If you are a senior, then you should have durable powers of attorney for financial and health needs, in the event that you or your spouse becomes incapacitated. You might also need an elder law attorney to help you transfer assets if you or your spouse move into a nursing home to avoid spending your life savings on long-term care.

Healthy people over 65 are in the best spot to do more than having estate planning documents prepared. That’s because they have the opportunity to develop a holistic strategy beyond the legal documents. This can give assurances that the family members and professionals they’ve assembled understand the principle of supported decision-making and how it will be implemented.

For example, an elder law attorney may focus on finding the least restrictive residential environment and making other health care and financial choices. An elder law attorney can also protect seniors with diminished capacity, who are being victimized by personal and financial exploitation.

An initial consultation with an elder law attorney will help determine the types of legal services they can offer, and the fees associated with these services.

Reference: Forbes (Oct. 4, 2021) “Hiring an Elder Law Attorney”

Do I Need Long-Term Care Insurance?

Women face some unique challenges as they get older. The Population Reference Bureau, a Washington based think tank, says women live about seven years longer than men. This living longer means planning for a longer retirement. While that may sound nice, a longer retirement increases the chances of needing long-term care.

Kiplinger’s recent article entitled “A Woman’s Guide to Long-Term Care” explains that living longer also increases the chances of going it alone and outliving your spouse. According to the Joint Center for Housing Studies of Harvard University, in 2018 women made up nearly three-quarters (74%) of solo households age 80 and over. Thus, women should consider how to plan for long-term care.

Ability to pay. Long-term care is costly. For example, the average private room at a long-term care facility is more than $13,000/month in Connecticut and about $11,000/month in Naples, Florida. There are some ways to keep the cost down, such as paying for care at home. Home health care is about $5,000/month in Naples, Florida. Multiply these numbers by 1.44 years, which is the average duration of care for women. These numbers can get big fast.

Medicare and Medicaid. Medicare may cover some long-term care expenses, but only for the first 100 days. Medicare does not pay for custodial care (at home long-term care). Medicaid pays for long-term care, but you have to qualify financially. Spending down an estate to qualify for Medicaid is one way to pay for long-term care but ask an experienced Medicaid Attorney about how to do this.

Make Some Retirement Projections. First, consider an ideal scenario where perhaps both spouses live long happy lives, and no long-term care is needed. Then, ask yourself “what-if” questions, such as What if my husband passes early and how does that affect retirement? What if a single woman needs long-term care for dementia?

Planning for Long-Term Care. If a female client has a modest degree of retirement success, she may want to decrease current expenses to save more for the future. Moreover, she may want to look into long-term care insurance.

Waiting to Take Social Security. Women can also consider waiting to claim Social Security until age 70. If women live longer, the extra benefits accrued by waiting can help with long-term care. Women with a higher-earning husband may want to encourage the higher-earning spouse to delay until age 70, if that makes sense. When the higher-earning spouse dies, the surviving spouse can step into the higher benefit. The average break-even age is generally around age 77-83 for Social Security. If an individual can live longer than 83, the more dollars and sense it makes to delay claiming benefits until age 70.

Estate Planning. Having the right estate documents is a must. Both women and men should have a power of attorney (POA). This legal document gives a trusted person the authority to write checks and send money to pay for long-term care.

Reference: Kiplinger (July 11, 2021) “A Woman’s Guide to Long-Term Care”

What Is Elder Law?

With medical advancements, the average age of both males and females has increased incredibly. The issue of a growing age population is also deemed to be an issue legally. That is why there are elder law attorneys.

Recently Heard’s recent article entitled “What Are the Major Categories That Make Up Elder Law?” explains that the practice of elder law has three major categories:

Estate planning and administration, including tax issues
Medicaid, disability, and long-term care issues; and
Guardianship, conservatorship, and commitment issues.

Estate Planning and Administration. Estate planning is the process of knowing who gets what. With a will in place, you can make certain that the process is completed smoothly. You can be relieved to know that your estate will be distributed as you intended. Work with an experienced estate planning attorney to help with all the legalities, including taxes.

Medicaid, Disability, and Long-Term Care Issues. Elder law evolved as a special area of practice because of the aging population. As people grow older, they have more medically-related issues. Medicaid is a state-funded program that supports those with little or no income. The disability and long-term care issues are plans for those who need around-the-clock care. Elder law attorneys help coordinate all aspects of elder care, such as Medicare eligibility, special trust creation and choosing long-term care options.

Guardianship, Conservatorship, and Commitment Matters. This category is fairly straightforward. When a person ages, a disability or mental impairment may mean that he or she cannot act rationally or make decisions on his or her own. A court may appoint an individual to serve as the guardian over the person or as the conservator the estate, when it determines that it is required. The most common form of disability requiring conservatorship is Alzheimer’s, and a court may appoint an attorney to be the conservator, if there is no appropriate relative available.

Reference: Recently Heard (May 26, 2021) “What Are the Major Categories That Make Up Elder Law?”

How to Prepare for Health Care Costs in Retirement

A recent study of U.S. adults ages 50 to 64 found that about half (45%) had low confidence in their ability to afford health insurance during retirement.

Kiplinger’s recent article entitled “Are You Prepared for Health Care Costs While in Retirement?” says that the average 65-year-old couple in 2020 will need roughly $295,000 in today’s dollars during their retirement to cover health care expenses. And that’s not counting long-term care.

However, depending on your age, income, health, location, and Medicare eligibility, that figure could be much different. When long-term care is added, the expense for health care can increase dramatically. According to the U.S. Department of Health and Human Services, a person turning 65 today has almost a 70% chance of needing long-term care services in the senior years. Right now, the national average median cost is $8,821 for a private room in a nursing facility and $4,576 for a home health aide. Therefore, planning ahead is critical.

Let us look at what can you do to help save for retirement and health care savings.

Use a tax-free account for health care expenses. You can start budgeting for your health expenses by contributing to a Health Savings Account (HSA). If you have a high-deductible health care plan, your employer may offer an HSA. An HSA lets you contribute, while receiving a tax deduction. The money can be invested and grow tax deferred. If this money is eventually used for qualified medical expenses, the withdrawal is tax-free. This year, the IRS allows individuals to contribute $3,600 and families to contribute $7,200. This can add up to a significant sum, which can be a readu source of health care funds, when needed.

Prepare for long-term care. Medicare Part A covers skilled nursing care for a specific period after hospitalization. However, it doesn’t pay for custodial care for Alzheimer’s or other cognitive illnesses. That is why many people buy a long-term care (LTC) insurance policy. This policy will go beyond what your health insurance may cover, by reimbursing you for services needed to help you maintain your lifestyle, if age, injury, illness or a cognitive impairment creates difficulties for you in caring for yourself. With long-term care insurance, you can prevent your retirement and savings from being depleted, if this care is needed in the future. An LTC insurance policy provides your loved ones with greater options for providing care, while relieving them from full-time caregiver responsibilities.

It makes a difference where you live. Another factor that will have a big effect on how much you spend on health care is where you’re living in retirement. Traditional Medicare coverage is the same all over, but prescription coverage (Part D), Medicare Advantage (Part C), “Medigap” supplemental plans, and private insurance vary, depending on where you live. Plus, the costs of long-term care can vary by thousands of dollars from one state to another. If you’re currently living in a state where health care costs are higher, you might think about moving somewhere else in retirement.

Look at your age when you retire. A person can start collecting Social Security at age 62, but you can’t begin Medicare until age 65. If you choose to retire earlier than 65, there are a few options you can look at for health insurance. When you retire, you may choose to continue your employer’s coverage under COBRA for up to 18 months. However, your premiums will increase substantially because you’ll be paying the full premium without the employer’s contribution. If your spouse is still working and eligible for health insurance, you may be able to move to their plan. You can also buy an Affordable Care Act plan on a federal or state health insurance marketplace.

Reference: Kiplinger (Feb. 15, 2021) “Are You Prepared for Health Care Costs While in Retirement?”

What are the Scariest Statistics for Retirement?

Think Advisor’s recent article entitled “11 Scariest Retirement Statistics: 2020” says that there is a lack of preparation, savings difficulty and general uncertainty that American retirees are facing. Here are those scary stats:

Just a quarter of Americans are on a trajectory to maintain their lifestyles in retirement. The other 75% will need to work longer, move to lower-cost housing and cut spending to maintain their standard of living, largely due to the coronavirus downturn.
The Social Security trust funds would be empty by 2023, without the payroll tax. While President Trump let employers temporarily defer the employee portion of payroll taxes, he said the deferred taxes could later be forgiven, or the cut made permanent. When he signed the order, he vowed to “terminate the tax,” if reelected. Republican lawmakers subsequently debuted a plan to fund any shortfalls from the Treasury.
Social Security benefits will be decreased by 21% if the trust fund runs out. Congress will have to intercede, or it could happen 10 years from now, if not sooner.
Those born in 1960 will have a big problem because of the complicated formula the Social Security Administration uses to calculate benefits. Pre-retirees born in 1960 will see a nearly 15% cut to their lifetime benefits from Social Security when it’s time to collect. If the pandemic suppresses the economy into 2022, those cuts will impact more pre-retirees. The impact to their Social Security benefits will also be permanent.
The 2021 Social Security cost of living adjustment, or COLA, will be just 1.3%. Retirees should note that rising health care costs and a potential 6% increase in Medicare Part B premiums may absorb that benefit increase.
More than 50% of Americans think the economy is worse now than in 2008, with 51% of Americans seeing the COVID slowdown as worse than the 2008 recession. A survey from Edelman Financial Engines also found that 26% had withdrawn money from retirement or savings for living expenses.
About 60% of retirement savers have fallen behind, according to a TIAA study. Among these, 30% said it was directly due to the pandemic.
Internet searches for “move out of the U.S.” have increased 16 times. International Living magazine says it had seen the jump in search traffic around the phrase since May. A total of 20% of respondents in a survey it conducted also said they wanted to move due to the pandemic. However, just 45% cited a desire to save money.
Approximately 42% of investors sold stock, and most of them (88%) of them regretted it. In response to the drop in stocks in mid-March last year, 42% of investors in a survey by MagnifyMoney sold at least one stock and 24% sold all their holdings. About 69% of those who sold stock at the start of the pandemic greatly regretted it, and 19% said they were somewhat regretful.
Roughly 80% of older Americans don’t understand retirement planning and don’t know the basics of how to successfully plan for a financially secure retirement, according to a study by The American College of Financial Services. The survey also found only 30% of respondents had a plan in place to fund long-term care needs, and just one in four actually had long-term care insurance.
About 3 million workers may have been driven into early retirement due to the pandemic. From March to August of 2020, 2.8 million older workers might have been pushed out of their jobs prematurely, with economic turmoil and poor health making it hard for them to resume their careers elsewhere, according to by the Schwartz Center for Economic Policy Analysis at the New School. The report found that 38% of unemployed older adults stopped looking for work and left the workforce, and an additional 1.1 million were expected to do likewise.

Reference: Think Advisor (Oct. 30, 2020) “11 Scariest Retirement Statistics: 2020”

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