March 6, 2017 by Jean
Over the holidays, during an annual celebratory dinner with friends, one of our party said that she had recently spent some time with a group of people in their seventies and they repeatedly referred to having a “plan.” Mystified, she asked what kind of plan they were talking about. The answer: a plan for what you will do when you can no longer manage your house.
The friend who recounted this conversation is a married woman with children and the youngest in our holiday gift-exchange group. She asked if any of the rest of us had a “plan.” After all, despite all the talk of “aging in place,” many of us live in houses that have served us well in our younger years but become increasingly problematic as we age. Those of us without spouses or children had clearly been thinking about this. I replied that, although I did not yet have a plan in place, I knew I needed one. While my house is well-designed for a temporary disability, it is not realistic to expect to stay here forever. The house is built on a hillside with the main entrance a full story above the driveway; there is no way to get in or out of the house without climbing a full flight of stairs. The house also has a central woodstove as its primary heating source, and wood heat will become more difficult to manage alone as I age. Another friend, like me a single woman without children and already in her seventies, replied that she had been to visit some nearby retirement communities but hadn’t yet seen anything that appealed to her.
For me, the availability of appealing alternatives that I could afford has been the biggest stumbling block to developing a “plan.” That stumbling block was at least partially removed in January when I had an appointment with a Certified Financial Planner, whose services are a benefit of having my retirement funds held by TIAA (Teachers’ Insurance and Annuity Association). The private colleges I worked for during my academic career did not have defined benefit plans that provide a pension when you retire, but they did have generous defined contribution plans (non-profit versions of 401(k) accounts). As a result, I entered retirement with more retirement savings than most retirees (although with less than the $1M some commentators claim you need to last you through your elder years).
I went over my monthly budget with the financial planner and my expectation that the Social Security I will begin to collect at age 70 will easily cover those monthly expenses. He then pointed to his printout of my retirement savings and said, “So what’s this money for?” “I don’t have a long-term care policy,” I explained, “so that is for long-term care.” He expressed the opinion that the amount I had would be more than enough to cover likely long-term care needs and promised to work up some numbers to demonstrate that to me at our next meeting. Then he returned to the question of what I would do with the rest of my retirement savings. “Are you telling me,” I asked, “that I could afford one of those fancy independent living retirement communities?” He responded that I could afford this and used as an example a coastal nonprofit continuing care community that I hadn’t heard of.
When I went home, I looked up the website of this community and saw that some of its independent living “cottages” are as big as my house. There are also smaller independent-living cottages and apartments, an assisted living facility, and a nursing home with all private rooms. This was an option I could get excited about! I looked up the website of another similar community a bit closer to where I live now and also found it an exciting possibility. When spring comes and the weather gets nice, two friends and I are going to make arrangements to visit these two retirement communities (and perhaps some others, too). I think I may have the beginnings of a plan.