Does this fact shock you? It certainly shocked me when I heard about it. Though I had a vague hint when overhearing a conversation in the elevator one day in NYC. I thought the person speaking about the outrageous rate they were paying to have their elderly parent in a nursing home must be some overpriced New York City luxury nursing home.
Now I understand that your typical nursing home may cost 8K a month. Most people do not have the long-term care insurance policy needed to pay the costs of the nursing home. The money to pay for a nursing home often wipes out the life savings of the elderly or deeply strains the savings of the children of the patient trying to pay for the nursing home.
The people who know the ins and outs of financial planning know that for an elderly patient to qualify for government coverage of nursing home costs one must start to transfer assets to family members well before 3 years prior to admittance to a nursing home. You cannot wait until admission to a nursing home is imminent to start transferring assets.
My Grandmother was adamant that she never wanted to go into a nursing home. My Mother was too. They both spent time in nursing homes prior to their death. They had medical problems that were well beyond home care. My Grandmother was furious when a series of strokes required her to move into nursing home care. She didn’t speak to my Mother for some time, blaming her for her transition into the nursing home. My Mom and I would arrive for a visit together and my Grandmother would talk to me and totally ignore my Mother. Needless to say this upset my Mother terribly.
Now when I hear people talking about wills, I want to roll my eyes. Wills are a crapshoot. The odds are one will have some catastrophic unexpected health issue that will bounce you into a nursing home at least once before death arrives. My Grandmother was a savvy woman and she had a doctor married to a lawyer among her grandchildren. She had the knowledge and the help needed to do financial planning. Even so, unexpected complications arose.
Even the best laid plans to ensure family finances will not be destroyed by nursing home costs often run amok. This happened to my Grandmother. She had meticulously planned for her investments in stocks to roll over to her children and grandchildren upon her death. She spent endless hours transferring her assets into mutual accounts. Alas there was some glitch in the wording of the accounts…the use of “and” instead of “or” or some such technicality and her accounts were deemed owned solely by her according to the rules used to determine eligibility for government coverage of a nursing home. She had to sell all the stocks to start the process of paying for the nursing home. The day I had to drive my Mother to the brokerage firm to do huge paperwork related to this was a sad day indeed.
At a monthly rate of 8k or so a nursing home rapidly depletes savings. Your will becomes a useless piece of paper if your funds have all gone to the nursing home. So pick an age at which you think it will be wise to start transferring assets. Wouldn’t you prefer your children or other beloved people in your life to have your assets rather than a nursing home? Or wouldn’t you rather live it up and spend your money on yourself or your family? Any option would be better than handing over huge bushels of cash to a nursing home.
And by the way these overpriced nursing homes don’t even provide good care. Too many nights I arrived after work at a nursing home to visit relatives and found they hadn’t been served dinner yet, or they were upset because they’d been trying to get some medical attention, or some other issue. It seemed clear that families must visit often and ensure their relative is receiving acceptable care.
Don’t wait until you are over 90 because it may be too late. Great health does not ensure you will not suddenly find yourself in a nursing home.
Don’t be stubborn. My mother spent endless hours as my Grandmother aged trying to get my Grandmother to release some of her assets to keep them safe. My Grandmother grew up in an orphanage and it seems was unable to relinquish control. Having control and independence was crucially important to her.
She loved her family tremendously. She was all nurturing. But when the end of her life came she was very upset that she was in a nursing home. She was well aware of how much it was costing and she was angry.
It makes me sad every time I think how upset she was to be in a nursing home. The day my Mother and I went to clean out her apartment was one of the toughest days of my life but for family funerals. So much of our family history was in that apartment. So much of my Grandmother’s spirit was there.
I miss her terribly. I mourn her. I also have deep sadness her life did not end the way she wanted it to.