Why save for retirement if medicaid will cover your costs!?!?

[Anonymous]

Anonymous wrote:I also wonder about people that save a ton of money for retirement. For example, my dad made an offhand remark one day that they have a few million saved and will probably never use all that money. Hell I wish they'd spend more of it and make up for lost time, they deserve it.

I agree it's important to save some amount of money (for argument's sake let's say an amount that would let you draw $35-40K per year in addition to your SS payments). That lets you take a few modest trips and live a comfortable life but not extravagant (this plan also assumes you'll have paid off your mortgage or will sell and move to a lower COL area so housing expense is minimal).

Obviously there's a margin of error here too and you want to err a little on the side of caution but I can't see socking away tons of money for retirement. By the time you're old and need nursing home care your quality of life kinda sucks already so why not use more of the money when you can actually enjoy it.

"Tons" of money is required in order to withdraw $35-40K per year! Agree or not?
Plus in another 20 years it'll actually be $50K you'll need to reap that same benefit, due to inflation. So how much will we need then?

[Anonymous]

Anonymous wrote:

Anonymous wrote:I also wonder about people that save a ton of money for retirement. For example, my dad made an offhand remark one day that they have a few million saved and will probably never use all that money. Hell I wish they'd spend more of it and make up for lost time, they deserve it.

I agree it's important to save some amount of money (for argument's sake let's say an amount that would let you draw $35-40K per year in addition to your SS payments). That lets you take a few modest trips and live a comfortable life but not extravagant (this plan also assumes you'll have paid off your mortgage or will sell and move to a lower COL area so housing expense is minimal).

Obviously there's a margin of error here too and you want to err a little on the side of caution but I can't see socking away tons of money for retirement. By the time you're old and need nursing home care your quality of life kinda sucks already so why not use more of the money when you can actually enjoy it.

"Tons" of money is required in order to withdraw $35-40K per year! Agree or not?
Plus in another 20 years it'll actually be $50K you'll need to reap that same benefit, due to inflation. So how much will we need then?

If you want to take $40k/yr from savings you'd best have --at minimum --- $1 million+ in liquid investments (just a rule of thumb re 4% annual draw etc.).

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I also wonder about people that save a ton of money for retirement. For example, my dad made an offhand remark one day that they have a few million saved and will probably never use all that money. Hell I wish they'd spend more of it and make up for lost time, they deserve it.

I agree it's important to save some amount of money (for argument's sake let's say an amount that would let you draw $35-40K per year in addition to your SS payments). That lets you take a few modest trips and live a comfortable life but not extravagant (this plan also assumes you'll have paid off your mortgage or will sell and move to a lower COL area so housing expense is minimal).

Obviously there's a margin of error here too and you want to err a little on the side of caution but I can't see socking away tons of money for retirement. By the time you're old and need nursing home care your quality of life kinda sucks already so why not use more of the money when you can actually enjoy it.

"Tons" of money is required in order to withdraw $35-40K per year! Agree or not?
Plus in another 20 years it'll actually be $50K you'll need to reap that same benefit, due to inflation. So how much will we need then?

If you want to take $40k/yr from savings you'd best have --at minimum --- $1 million+ in liquid investments (just a rule of thumb re 4% annual draw etc.).

PP here. I'm assuming two of us so $17-20K each plus whatever SS we would receive. I'll be honest and admit I really don't know what that translates to regarding the amount you need to save and the amount of total liquid investments you need to have. To the other PP, I'm not sure if I care if I'm in a crappy nursing home at that age as compared to having a nicer time in the next 20 years while I can enjoy it. Again, I'm not saying to save nothing but to save and plan for being in a luxury nursing home at the expense of memories while you can enjoy them doesn't make sense to me.

[Anonymous]

Anonymous wrote:

Anonymous wrote:As PPs noted, life on Medicaid is anything but sweet.

Curious, OP, if your cultural tradition includes caring for aging parents in exchange for inheritance, why is Medicaid an issue at all?

The above scenario works in the homeland, where typically the daughter or daughter in-law does not work outside of the home. It won't work for us here becauseboth my brother and I work and therefore can't provide the care. My parents never thought, does anyone?, that they would end up in a position to worry about this. So as they built up an inheritance for us, due to misinformation, they missed or misunderstood how medicaid works. They have a decent savings - a fully paid house, car and about 100-150K savings. I just wished they enjoyed life more and didn't feel the need to save this money for me and my brother - esp since we are both working and contributing to our own retirement plans.

I didn't realize that the care a medicaid recipient receives is different. My husbands undle was in a nursing home for rehab, ended up dying there, and he was self pay. I thought it was a horrible place, as a PP described, sad, old people left in wheelchairs in hallways, dilapidated rec area with various games that didn't work. His estate went to his care and ti was awful.

But if your parents have some money, why couldn't they live with one of you and use the cash to hire daytime help? It's far better than spending it down and going into a Medicaid home.

[Anonymous]

Anonymous wrote:PP, Medicare does not cover nursing homes. When you hear about someone who is in a nursing home and has run out of money and is having it paid for, it is Medicaid, not Medicare that is paying for it and only for those who are out of money.

OP, living on just SS in retirement is living very poor and many people do not end up needing nursing home care for long at the end of life so it would be silly to just keep yourself extra poor in old age for that reason. Also, as others have said, it is hugely helpful to be able to pay for at least a little nursing home care and then switch to Medicaid if money runs out.

I'll also add that Medicaid doesn't pay for things like clothing, haircuts, or having a telephone in your nursing home room. Many, many physicians do not take Medicaid patients, either. It really should be used a 'last resort'.

[Anonymous]

Anonymous wrote:I also wonder about people that save a ton of money for retirement. For example, my dad made an offhand remark one day that they have a few million saved and will probably never use all that money. Hell I wish they'd spend more of it and make up for lost time, they deserve it.

I agree it's important to save some amount of money (for argument's sake let's say an amount that would let you draw $35-40K per year in addition to your SS payments). That lets you take a few modest trips and live a comfortable life but not extravagant (this plan also assumes you'll have paid off your mortgage or will sell and move to a lower COL area so housing expense is minimal).

Obviously there's a margin of error here too and you want to err a little on the side of caution but I can't see socking away tons of money for retirement. By the time you're old and need nursing home care your quality of life kinda sucks already so why not use more of the money when you can actually enjoy it.

Spoken like someone who has never been responsible for an elderly person.

Sure, a person's quality of life sucks if she has, e.g., dementia and incontinence and arthritis and difficulty eating and drinking. No question. Believe me, however, that if she has zero stimulation during the day - no social life, no newspaper, no books, no outing to sit in the sun - as well as a wet Depends on for hours; pain meds only when the frazzled staff gets around to it; and is left to her own devices to get food and drink down, well, it is not a pretty existence. And it can go on for a decade or more (I've BTDT, twice).

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:As PPs noted, life on Medicaid is anything but sweet.

Curious, OP, if your cultural tradition includes caring for aging parents in exchange for inheritance, why is Medicaid an issue at all?

The above scenario works in the homeland, where typically the daughter or daughter in-law does not work outside of the home. It won't work for us here becauseboth my brother and I work and therefore can't provide the care. My parents never thought, does anyone?, that they would end up in a position to worry about this. So as they built up an inheritance for us, due to misinformation, they missed or misunderstood how medicaid works. They have a decent savings - a fully paid house, car and about 100-150K savings. I just wished they enjoyed life more and didn't feel the need to save this money for me and my brother - esp since we are both working and contributing to our own retirement plans.

I didn't realize that the care a medicaid recipient receives is different. My husbands undle was in a nursing home for rehab, ended up dying there, and he was self pay. I thought it was a horrible place, as a PP described, sad, old people left in wheelchairs in hallways, dilapidated rec area with various games that didn't work. His estate went to his care and ti was awful.

But if your parents have some money, why couldn't they live with one of you and use the cash to hire daytime help? It's far better than spending it down and going into a Medicaid home.

This what we are planning on doing - it is incredibly expensive and we will have to modify our home. They still feel that it is a waste of money. neither my brother or I need their money and we are trying to convince them that we want them to age happily rather than be placed in a nursing home. Assisted living is out as my father is not self sufficient. I had no idea that there is a difference in care/faciliteis for self pay vs. medicaid. I don't thik they know that either so this may be the way to convince to use thier savings for better care.

[Anonymous]

I worked for a company that owned assisted living facilities. Some states have state-run homes that are medicaid-funded. They are rarely the nicer facilities. The nicer places generally have a 2 or 3-year spend-down requirement before they will let you in. So you have to be able to pay their fees for 2 or 3 years (at $5K/month/person) before they'll accept medicaid for you. And when you do become a medicaid patient, they're getting less money per month, so you will likely be forced to share a room with a stranger.

Not so bad if you're used to roommates, but something to consider.

[Anonymous]

13:13 here - also note that alzheimer's/dementia services are even more expensive than standard assisted living. So if you care about the quality of your life later on, consider doing some of the things now to try to ward off alzheimer's. (eat omega-6 fats, do crossword puzzles, exercise, etc.)

[Anonymous]

Why pay rent when you can just commit a crime and have the government provide room and board for free?

[Anonymous]

Anonymous wrote:13:13 here - also note that alzheimer's/dementia services are even more expensive than standard assisted living. So if you care about the quality of your life later on, consider doing some of the things now to try to ward off alzheimer's. (eat omega-6 fats, do crossword puzzles, exercise, etc.)

That's right. Doing crossword puzzles and eating fish will prevent alzheimers.

[Anonymous]

Anonymous wrote:Why pay rent when you can just commit a crime and have the government provide room and board for free?

Seriously, this is what it sounds like. There is a LOT of gray area, and potentially many, many years between retirement time and being demented and destitute in a nursing home on medicare. Why on earth wouldn't want to at least try to plan ahead for a comfortable retirement?

[Anonymous]

DDT (dichlorodiphenyltrichloroethane)
Scientists have already found a strong potential link between pesticides and Parkinson’s disease. Now, a preliminary study released in January suggests that the pesticide DDT, which degrades so slowly that it continues to linger in the environment more than 40 years after the U.S. Environmental Protection Agency banned its use in the U.S., may also contribute to Alzheimer’s.

[Anonymous]

I can't even give my relative who is in assisted living a present, because whatever I give her will be stolen from her almost immediately. By the staff, by fellow residents - who knows. She knows, but she isn't willing to try to be moved and says it would be the same anywhere.

I switched to flowers but she asked me not to bring those either because it causes too much envy.

[Anonymous]

NP here. I just want to say thanks to all those that have taken the time to share their experiences. I worry about how things are going to play out for my in-laws.