The Baby Boomer Generation is rapidly reaching retirement age, and the oldest Gen Xers are approximately a decade from leaving the workforce, meaning their children should be placing a serious focus on elder care. Early elder care planning is beneficial for a variety of reasons—here, elder care attorney Douglas C. Lauenstein explains why the children of those who are soon to retire should begin planning for their parent’s care as early as possible.
The Surge of Retirees Places a Massive Burden on Federal Benefits
Approximately 10,000 Baby Boomers are retiring each day across the United States, and this collective will put a massive strain on an already burdened Social Security and Medicare system. Based on Social Security Administration figures, the Social Security trust will likely run out by 2034, at which time only 79% of benefits will be able to be paid by tax revenue. Federal reports have shown that the trust fund that covers Medicare hospital expenses is due to run out by 2029. While none of these figures indicate the complete end to federal benefits, it is not prudent for families with elderly parents to rely on federal benefits for care costs.
Many Baby Boomers and Generation Xers Do Not Have Extensive Retirement Savings
Due to a variety of factors, including the 2008 recession and various socioeconomic issues, Baby Boomers have struggled to save enough money for retirement. This age demographic will require approximately $658,000 in defined contributions plans by the time they retire, but the average Baby Boomer only has $263,000 in one of these accounts, and the average older Boomer (65-74) has only $300,000 saved. This leaves an extensive gap between what Baby Boomers will require, and what they actually have saved, for retirement and care costs.
According to recent surveys, approximately 37% of Gen Xers wish to retire one day but know that they do not have the funds to do so. Nearly two out of 10, or 17%, claim that they have not saved anything for retirement. This may be due to the various market downturns Gen Xers experienced, as well as a cultural workplace shift from pensions to 401(k)’s.
Baby Boomers and Generation Xers are Facing a Variety of Serious Health Problems
Center for Disease Control (CDC) research shows that both Boomers and Gen Xers are facing similar health problems as they age, including type 2 diabetes, heart disease, various cancers, depression and Alzheimer’s. These conditions, although far more treatable and manageable than they once were, can cause patients and their families to incur tens of thousands of dollars in healthcare-related expenses.
Elder Care is Expensive
Health problems aside, general elder care is expensive as well. In 2016, a private room at the average nursing home cost $253 a day, or more than $92,000 annually—a semi-private room averaged $82,125 a year, or $225 a day. While aging in place can lower these costs, ensuring a home is properly outfitted to accommodate an elderly family member can still cost thousands of dollars. Early planning is absolutely vital to ensure solutions are put in place so that the elderly and their families can afford these expenses and live in relative comfort.
Speak to an Elder Care and Estate Planning Attorney to Determine the Best Solution for Your Family
Although early planning is best to ensure that major elder care expenses are able to be covered, solutions are available for individuals with parents at any stage in life. The best solution is to speak to a qualified, elder care and estate planning attorney, who will be able to guide you through the options available to accommodate your unique needs. Douglas C. Lauenstein, who has passionately advocated for families and the elderly for years, wants to speak to you about your elder care and estate planning needs. Contact The Law Offices of Douglas C. Lauenstein today to schedule a consultation!