Nearing retirement and want to change up some of your healthcare and savings plans? Robert Powell, host of the Yahoo Finance Decoding Retirement podcast, sits down with Brad Smith on Wealth to talk about how you can better plan for the second half of your retirement.
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This post was written by Luke Carberry Mogan.
If you're nearing retirement, you may be thinking about different financial considerations like enrolling in Medicare, adjusting your budget and withdrawing funds from your retirement accounts, but there are also longer-term considerations that you'll need to think about for more comprehensive planning. Joining me now, we've got the host of Decoding Retirement, Bob Paul, in studio with us. Bob, you got to talk about the differences that you perceive in the planning for the first so-called part of your retirement versus the second part of your retirement.
Yeah, so there are typically three phases of retirement: the go-go years, the slow-go years, and the no-go years. And most people plan for the go-go and slow-go, but less so for the no-go years. And the no-go years are really important to plan for because that's when all your health concerns arise. And many people often say that, um, they don't want to be a burden on their children. Well, if that was the case, if you don't want to be a burden on your children, you would plan for those no-go years. And you wouldn't plan during a crisis; you would plan decades before there's a crisis.
And so how do you think about how you're paying for all of this? Is it all you, or is there government assistance that comes along?
Yeah, so there are two things to think about, Brad. One is where will you live and how will you pay for it? So in your go-go and slow-go years, most people want to age in place. 80% of older adults want to age in place. And so if they need health care at home, there are a number of options. They could get a geriatric care manager, they could get a home health aide, they could get unpaid help through their, uh, daughters and sons and loved ones, um, and that's one way to think about, or they could go to an adult daycare, too. So there's options for people who are aging in place.
And so how do you think about how you're paying for all of this? I mean, when you ultimately, uh, are are clarifying how people are paying here. I mean, just break that down for us.
Yeah, so a lot of people don't have long-term care insurance. So most of the time what they're doing is paying out of pocket for things like home health aides or geriatric care managers. Uh, things get a little bit more complicated when you have to move out of your house into maybe a continuing care retirement community or assisted living or, worse yet, a skilled nursing facility. Then things get a lot more expensive. And then you have to think about, well, if you're going into a skilled nursing facility, will Medicare pay for it? And that does end up paying for about 70% of Americans who are in a long-term skilled nursing facility. On the other hand, if you're in an assisted living facility or in a continuing care retirement community, it's likely that you're paying out of pocket for it. And those can get expensive, around $5,000 a month.
Oh wow, yeah. Bob, thanks so much for taking the time breaking this down for us.
Thank you, Brad.
