MY MATERNAL grandmother just celebrated her 100th birthday. She still lives a mostly independent life, residing in her own apartment within a senior living facility. She walks to the dining room three times a day for her meals, does her own laundry and is always willing to talk about current events.
At age 54, I often try to imagine what it’ll be like if I live to the same age as my grandmother. The process usually overwhelms me with angst. Will I have enough money to support myself if the retirement phase of my life exceeds the number of years I’ve been actively employed? Will I be mentally and physically capable of caring for myself in my 90s or later? Who will I rely on for care if I live to be a centenarian?
Adding to my anxiety is the fact that I chose not to raise children. I’m not alone in that decision. According to 2010 census data, 19% of my female Gen X cohorts also chose to remain childless. I recently heard the term elder orphan, a euphemism applied to elderly adults who don’t have children or spouses to help them with caregiving as they age. The number of elder orphans is expected to increase sharply over the next few decades as life expectancy rates continue to rise.
My husband—who is 13 years older than me—may be able to depend on me for some of his caregiving needs as he ages. But if I live into my 90s, it’s likely I’ll need to rely on people outside of my family for assistance. Even though I haven’t yet reached retirement age, I’ve already begun the process of preparing to live independently for as long as I can. I’ve recognized three pillars I consider important for a well-rounded retirement: physical health, mental acuity and financial stability. With retirement looming, I’ve already established ways to meet those needs.
Two years ago, my husband and I purchased a single-story home in an age-restricted community. The community has the infrastructure necessary to provide residents with ample opportunities to nurture their physical and mental well-being as they age. Within the 11 square miles that the city encompasses, there’s a full-service hospital. There are also several physicians’ offices, a dedicated fire and ambulance service, and a volunteer sheriff’s posse that provides wellness checks on residents.
The community has in place a wide variety of activities designed to provide the mental stimulation and social interactions necessary for healthy aging. In addition to four recreation centers, there are numerous parks, walking tracks and swimming pools. There’s also a library, woodworking shop and movie theater. The grocery stores, restaurants and shops within the community are all easily accessible by car, golf cart, bike or on foot. For mobility-challenged residents, a shuttle service is available to pick up residents from their homes and take them to any location within several square miles of their residence.
To achieve my financial goals, I’m planning to set up an annuity to supplement my Social Security and pension. This money should provide me with enough income to cover my basic living expenses. On top of that, I’ll be able to leave a substantial portion of my retirement earnings in an index fund to help mitigate the risks of inflation and provide me with supplemental discretionary income.
If I end up aging as gracefully as my grandmother, I may find my need for living assistance is minimal. But if I do find myself needing significant help caring for myself, I’ll have options. I may be able to transition into an assisted living facility within our retirement community or receive in-home assistance from any number of care providers located nearby.
Knowing I have a plan in place to address my physical, mental and financial well-being helps me relax a bit as I think about my future. Should I live as long, or longer, than my grandmother, I’m hopeful that I can remain independent for much of that time.
Kristine Hayes is a departmental manager at a small, liberal arts college. She enjoys competitive pistol shooting and hanging out with her husband and their dogs. Check out Kristine’s earlier articles.
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Perhaps this was what CJ was alluding to, but I’d look into establishing a legal power of attorney (for healthcare and otherwise), who might be structured to become activated in the event you and your husband are for whatever reason unable to make those decisions. Establishing that person now well in advance would, for me at least, provide some peace of mind as a sort of insurance policy for decision making.
I think that’s an excellent idea. I’ve recently been researching the idea of having a ‘professional guardian’, a person/firm who would step in and manage our healthcare, assets, etc. in the event we can’t. Not surprisingly, there are several who work in the age-restricted community we will eventually retire to. These firms will assist their clients with home maintenance, financial planning and health care. I’m curious to begin researching how they’re vetted and what sort of certifications they have to have. Thanks for your comment!
Thank you for your article. This is something I worry about constantly. The biggest concern is the lack of a caring advocate – the role kids usually assume.
I look at the time I spent seeing to my own parents care: accompanying them to the ER; coordinating with multiple doctors who don’t communicate with each other or bother to read chart notes; staying vigilant with nurses and assistants to prevent many treatment mistakes or miscare. Frequently visiting/checking on them in ALF/nursing home to make sure they’re not abused/taken advantage of.
When one doesn’t have kids, friends & extended family may call, visit or include you at holidays, but that’s likely the extent of it. Few will do the above. I haven’t found an answer to that yet.
But your article was a rare positive take on the topic of aging alone – and there is some comfort in knowing others are facing these challenges too.
Thanks for your comment. Indeed, I too worry about not having a care advocate as I age.
I know from watching my parents age, it’s nice to have someone to attend medical appointments, provide temporary housing and serve as support and care givers.
I don’t know what the answer will be for me if I should live to be 100. A close friend and I have joked about moving in to a house together (ala The Golden Girls), if we should both end up old and alone.
I agree that knowing others are thinking about the same issues provides some comfort.
Thanks again for contributing to the discussion!
Kristine – since you and I are identical in age, I really enjoy reading your HD posts. There is a refreshing humility to be found in your writing, and you have an “engineer’s eye” for the little details in you life planning that sometimes I might not have thought of.
Question – has long-term care insurance (or, as an alternative, hybrid life ins with a LTC benefits rider) been a part of your planning? This area may already be “baked in” to your life plan vis-a’-vis the living community you have selected, but the associated care costs can be significant if not. Just curious. Thanks again for a great post!
Thanks for the kind comments. I really enjoy being a part of the HD community and I hope that sharing the details of my own humble financial life will help and inspire others.
Long term care insurance is something I think about a lot. The general consensus among financial experts seems to be that a policy should be purchased at around age 60. The HD article on the subject suggests a dollar-cost-averaging approach might also be a logical way to go (https://humbledollar.com/money-guide/long-term-care-insurance/).
I haven’t purchased any LTC insurance yet. At 54, I still have a few years to opt in. I have the option to purchase a policy through a state pension plan that I became vested in 25 years ago.
When I contemplate the subject, I think about my grandmother. Even at 100, she lives (mostly) independently. She likely wouldn’t meet the criteria for being able to tap into the benefits of any LTC policy. She doesn’t own such a policy but if she had purchased one forty years ago, I’m reasonably sure the amount of money she would have paid in premiums by now would have exceeded the amount of benefit she would receive at some point in the future. Of course, that’s the gamble one takes on any insurance product.
So, long story short, I’m conflicted about purchasing a policy. If things go according to plan, I will have Social Security, a small pension payment, an annuity payment, a mortgage-free home and some mutual funds when I hit ‘old’ age. This is pretty much identical to the asset mix my grandmother currently has and it’s unlikely she’ll outlive the savings she’s accumulated.
Thanks again for commenting and reading Humble Dollar!
I purchased LTC at age 45 for my wife and I who is four years older. It was quite inexpensive back then. It was part of a group plan I installed. Now I’m 77 and last year they raised the premiums 46% and told us this year it would be another 25% and they gave the option to convert to a lump sum with no premiums, but is was too small to be of value. It appears 30 plus years of premiums may be wasted because I doubt if there is another raise this fall if the coverage will be affordable. It’s tough to find anyone to sell a viable LTC policy these days.
I’m thinking I may have to take a chance and invest what I was paying in premiums and hope for the best.
I was in the market for LTC insurance some years ago and almost pulled the trigger. But fear over what you’ve encountered (sorry) discouraged me from taking that course. I think the industry is continuing to find a stable pricing model, so instead I’ve rolled the dice and invested what would have gone to premiums in the broad market.
I went back and forth, but finally decided to skip it. If LTC was reasonably priced OR covered a much longer timeframe, it would make sense. But today’s LTC policies couple ridiculous prices with inadequately short coverage periods.
I can cover 2-3 years of LTC myself – but that black swan type event – early onset dementia, an unfortunate health issue/accident, requiring 6-10 years of home care or a facility is what will wipe out even a robust porfolio – and while medicaid is an option at that point, hardly enticing, given quality and limitations of medicaid facilities.
Paying thousands each year for what may end up inadquate coverage didn’t make financial sense to me.
After your comment, I checked to see what premiums would be for me (through a state pension plan). For 2 years of coverage (at $3000/month), I’d be paying almost $100/month (starting at age 60) in premiums. Not sure what my final decision about getting a policy will be but at the moment I’m leaning towards not purchasing one.
Your eye for planning is evident here. I think plenty of HD readers are now earning, or grew up earning, in the same income brackets as you describe. Planning and saving and planning to save, brings us together.
As for me, having gone from being a “we” to just “me”, the question of who will be around if I am fortunate enough to grow very old and mostly healthy is one I think about occasionally. The neighborhood I’ve lived in for 30 years has always had a mix of old and young people. Many “age in place” till very old, late 80s, early 90s.
My brother moved to an over-55 community. But every time I think of making that move someday, I think of my neighbors and how I may someday be that “oldest lady on the street” who gets help with her chores. I hope I can stay friendly enough so people will look kindly on me! As for children, though I have them, I have learned from my friends that many children move away, some far away, and though they love their moms and dads, the parents also need the support of local friends and neighbors, city services, and helping nonprofits, along with whatever additional services they pay for on their own. This planning and self-care lessens the worries of one’s grown children, in middle life with its own challenges.
Catherine. Thank you for your comments. I hope my articles help inspire people to both plan for their future and save money. While I doubt I will ever be considered ‘wealthy’, I’ve been able to accumulate a fair amount of retirement savings on a relatively modest salary.
Moving to an age-restricted community has been an easy choice for me and my husband to make. We were both looking to leave the area of the country we grew up in and we both enjoy the solitude our future community offers. I will likely be one of the youngest residents when we move there permanently but hopefully that will give me plenty of time to establish friendships and community support.
I’m familiar with your area — we lived there for 15 years — and still I’m puzzled by how you found the community that you described. It’s not exactly known as a “retirement haven”, and real estate prices, last I checked, wouldn’t be exactly described as, “affordable”. Could you please, in your next installment, tell us how you found such an amazing place? For reasons of climate, we’re not likely to return, or if we did it would only be for 3-4 months a year, but boomers are retiring everywhere, so one would think that the community you describe would be replicated in many areas. Or is there some magical spell that makes in possible there?
Hi Scott. When you say you’re familiar with the area, did you mean the Pacific NW or Arizona? I’m currently living in the NW but our retirement home (and the community I described) is in Arizona. Real estate prices in the NW are definitely far from affordable, especially these days. The small home I purchased just two-and-a-half ago has added nearly $80K in equity in that short amount of time. I’m thankful I purchased when I did as I wouldn’t be able to afford anything beyond a condo or townhouse at this point.
We purchased our home in Arizona two years ago and while it’s still vastly more affordable down there, as compared to the NW, the real estate prices there are also surging. We purchased a 1900 square foot home for less than $250K in 2019. These days that same home would likely sell for well over $300K.
Let me know if you have any questions and thanks for your comment.
We lived in Portland. Somehow I missed your move to Arizona, which explains a lot in terms of (1) finding communities that cater to retirees and (2) housing affordability.
Beyond affordability, were there other reasons for the move? At one time we thought Portland would be ideal for retirement because of the fantastic mass transit, but it just kept getting harder to tough out the dreary, grey winters.
Hi Scott. I figured from your comments that you were probably referring to Portland. Here’s one article I wrote a few months ago about our experience purchasing a second home in Arizona:
Affordability was certainly one of the factors influencing our move. Not only is real estate less expensive in Arizona, so too is the cost of living. We hired an electrician to do some work at our Arizona house and I’m estimating it cost about 50-60% less than what the same work would have cost us here in Oregon. The property taxes are much less (almost $4000 a year on an 1100 square foot home in Portland vs. $1100 a year on a 2000 square foot home in Arizona). Yes, there’s a sales tax in Arizona, but Oregon has a personal income tax rate that’s approaching 10%.
Add to all of that the dramatic increase in crime that Portland is currently experiencing and the dreary Oregon winters–we had a massive ice storm this year that wiped out power to nearly 1/2 of the metro area–and it wasn’t difficult for us to decide to leave the area. Both my husband and I have lived in the Pacific NW for most of our lives, but both of us are looking forward to more sunshine and less rain.
As always, appreciate the vulnerability from you (and all authors on this site). A practical question occurred to me: if one is an “elder orphan” who manages the funds for the elder (if they ever become unable to) if there’s no child or spouse? A trusted (younger) friend, or a trust?
Thanks Ben. You ask a great question. My husband has a sister-in-law who works as a legal guardian for adults who can’t manage their own healthcare/finances. I believe guardians are generally court-appointed, but I suspect one could appoint one on their own if they wanted to. Just don’t watch the Netflix movie I Care a Lot if you ever plan on having a guardian.
I think the fear of aging alone..of just being alone…is inherently human. The difference is, people without children know ahead of time who won’t be there for their future selves. Others won’t know if their children will be there until the time comes when they need them. However, this doesn’t mean no one will be there.
What helps me find solace on this topic is something I’ve read from various authors on this blog. It’s the importance of the social investment for retirement: family, friends, church, neighbors, people we don’t even know yet…
I’m reminded of a sweet elderly neighbor I had who was close to 96 when she passed. She never married, but had family in the area. My wife and I would often visit with her over a cup of coffee or go over and help her with a task. I’m sure I wasn’t part of her retirement equation. I was a mere stimulus check compared to her actual social investments, but I enjoyed spending time with her and would’ve done anything for her. Of course, at the time I didn’t think about it like this. It was just life. I think all we can do is plan and hope our investments can take care of us in the future. The rest, our future selves will have to figure out…
I love this!
Not trying to be critical and certainly don’t know your entire situation, but there are a lot of “I” and “my” in what you write and no “our.” Seems like your financial plans should consider the possibility of high spending on care in old age by either or both of you, especially given your age difference. Even your idea for an annuity in addition to a pension and SS could prove to limit financial flexibility if needed. Again, not knowing full money picture.
I think if we can get past the semantics of “I” versus “we”, Dick’s point is salient here. Long term care expenses are a huge factor to build into any retirement plan (an estimated 58% of females over age 65 will need some form of LTC during their lifetime…and 47% of males, for that matter). Not putting this topic into the planning discussion leaves a great deal to chance and “hope”.
My late dad told me frequently that hope is not a substitute for good planning. Hope for the best? Yes – with intention behind it…exercise, eat well, stay engaged mentally, etc. Plan for the worst – a financial necessity. TBH, I suspect that Kristine may likely have this factored into her longevity financial plan already.
Indeed, I do tend to write from my own perspective. I think I’ve mentioned it before–in the comments section of some of my other articles–that the reason for taking that perspective is because it’s the only one I’ve used since I started writing for HD. Four-and-a-half years ago, there was only ‘me’. And while I’ve since evolved to become half of ‘us’, I still choose to focus on my own financial details in the articles I write. Yes, there may be high spending on care for both of us as we age. Thankfully I think ‘we’ have put together a reasonable plan of dealing with those costs, using the financial resources each of ‘us’ has.
When someone says that they are “not trying to be critical” it is a safe bet that they are.
Trying to be polite, really. My point being the issues raised in the post, the money matters seem like things that require a combined our strategy and approach in a marriage.
Given your criticisms of Millenials and your what you consider the wasteful spending habits of those who are behind on saving for retirement, I wasn’t surprised that you felt the need to make what I considered to be another petty criticism.
Katherine’s writings indicate that she is very level-headed and financially responsible. Did you really think that she and her husband were independently planning for the future?
Not sure if you’re the R Quinn that writes for HD, but his last blog post contained a lot of “I” and “my” as well. Why? People speak from their own perspective, as Kristine is doing in speaking her concerns of aging alone and the steps she’s taking to combat that.
It’s me, and in my last blog I also said,
My wife and I based our ongoing expenses—our lifestyle—on what was left of my base salary after taxes were taken out, and after deductions for 401(k) contributions and premiums for health, dental, group life and long-term-care insurance. Meanwhile, we sometimes used my annual incentive pay for onetime major purchases, but mostly we saved the money.
We would never spend more each month than could be paid for in full that month.
I just don’t see how one person in a marriage can have individual financial goals short or long term, or how contingency planning can’t always include risks for both parties. But as I said, we don’t know the full money picture. Maybe I’m wrong. It’s happened before.
I suspect, from reading the articles by many HD authors, the financial strategies and resources my husband and I have are somewhat different from those of many other contributors. I don’t know how many could imagine living off of $35,000 a year as I was doing just a few years ago. I don’t know how many could imagine working for less than $50,000 a year (gross) as I did for most of my career.
I’ve never had ‘annual incentive pay’ and I’ve never had to worry about how to avoid paying taxes on inheritances or worry about leaving too much money behind to any heirs. I’m actually quite proud of how much I’ve been able to accumulate given my modest lifestyle and salary.
And I surely don’t think anyone is criticizing you. In my case I was interpreting what I read which as you noted, was not the full planning strategy you have in place.