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Old 01-31-2016, 11:32 AM
 
796 posts, read 777,594 times
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I am one of those retirees with no family or anyone else to look out for me in the future. This is something I am very worried about and I am trying to make plans. I am 65. I have looked into different ideas of what to do and it seems as though my best plan would be to go into a CCRC (continuing care retirement community). I would prefer to wait until I am older to do this but I think that feeling safe and knowing there would be healthcare in the future if I would need it is the most important thing right now.


I have been checking into CCRC's and most of them are way too expensive. When I look at the rates for some of them it seems like there are some I could afford. I have enough for the entrance fee and my SS check (my only income) would cover the maintenance fee with some left over. However, that is not the way they look at it when considering if they will accept you. They want to feel that you can afford future needs. For example, one place told me they want a person to have two times the amount of the entrance fee and three times the amount of the monthly maintenance fee in order for them to consider you. My problem is I can afford the entrance fee but don't have the extra for the monthly maintenance fee. I would have extra left over from the sale of my home that I put in a CD or something and eventually could use if I would need to in the future. However, they won't consider that money as a backup for the future since you could spend it all in the meantime. I have been told by more than one person I need to somehow generate more monthly income.


I have been trying to do research to figure out a way to do this. I will need something that gives me a guarantee of $800.00 per month. How much money would I need to invest to get this amount and what type of investment would that be? I really don't understand much about investments. I tried calling a financial advisor once but they didn't even want to talk to me because I didn't have a lot of money. I'm not even sure where to go for advice. I have read a lot of negative things about annuities but would that be something that might work for someone in my situation?


Any advice or suggestions?
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Old 01-31-2016, 01:42 PM
 
Location: Nescopeck, Penna. (birthplace)
12,351 posts, read 7,521,491 times
Reputation: 15955
If you are planning on going into retirement completely alone, autonomous and self-reliant, you are setting yourself up for betrayal as soon as there's no one to watch out for your interests. This is especially true if you rely exclusively upon an institution, which has no incentive not to let you fall through the cracks and relieve themselves of their problems -- and you.

What's more, yields on savings guaranteeing easy access are a fraction of what they once were. You have to lock your money in, with a stiff penalty for withdrawls. The more security you insist upon that more you will pay if your circumstances change.

Two bits of advice:

(1) Find someone you can trust who can carry out your most important wishes when you can't; they should be a generation behind you in age, if possible -- and have a "back-up' if something should happen to them. If the complications of a physical/personal relationship aren't in the equation, good friendships aren't hard to build.

(2) If you own a place to live -- keep it for at least as long as you are capable of living independently. That's an even-better option of you're reasonably good at minor household maintenance. You can also rent it out -- either completely, or in part. But choose your tenants very carefully, especially if you plan being outside the area for any length of time.

I knew by the time I entered my Fifties that I wouldn't be well-suited to either marriage or a typical "homebody" retirement, so it gave me an incentive to plan ahead. But the number of unattached single adults -- and "displaced" properties is bigger than ever. Go out looking and (carefully) networking, and you'll probably discover that you have more options than you recognize.

Last edited by 2nd trick op; 01-31-2016 at 02:40 PM..
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Old 01-31-2016, 02:28 PM
 
Location: Central Massachusetts
4,800 posts, read 4,855,118 times
Reputation: 6379
Quote:
Originally Posted by dj10 View Post
I am one of those retirees with no family or anyone else to look out for me in the future. This is something I am very worried about and I am trying to make plans. I am 65. I have looked into different ideas of what to do and it seems as though my best plan would be to go into a CCRC (continuing care retirement community). I would prefer to wait until I am older to do this but I think that feeling safe and knowing there would be healthcare in the future if I would need it is the most important thing right now.


I have been checking into CCRC's and most of them are way too expensive. When I look at the rates for some of them it seems like there are some I could afford. I have enough for the entrance fee and my SS check (my only income) would cover the maintenance fee with some left over. However, that is not the way they look at it when considering if they will accept you. They want to feel that you can afford future needs. For example, one place told me they want a person to have two times the amount of the entrance fee and three times the amount of the monthly maintenance fee in order for them to consider you. My problem is I can afford the entrance fee but don't have the extra for the monthly maintenance fee. I would have extra left over from the sale of my home that I put in a CD or something and eventually could use if I would need to in the future. However, they won't consider that money as a backup for the future since you could spend it all in the meantime. I have been told by more than one person I need to somehow generate more monthly income.


I have been trying to do research to figure out a way to do this. I will need something that gives me a guarantee of $800.00 per month. How much money would I need to invest to get this amount and what type of investment would that be? I really don't understand much about investments. I tried calling a financial advisor once but they didn't even want to talk to me because I didn't have a lot of money. I'm not even sure where to go for advice. I have read a lot of negative things about annuities but would that be something that might work for someone in my situation?


Any advice or suggestions?

LTCi with an unlimited benefit. Start it now while it is at its least expensive. Waiting each year adds to the cost.
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Old 01-31-2016, 03:18 PM
 
1,076 posts, read 1,119,505 times
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I disagree. For single people, I am not a fan of LTCI. There is no cap on how much it can increase. Once it becomes unaffordable, you lose everything you put into it. I will wait until they come up with something better.
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Old 01-31-2016, 04:11 PM
 
2,421 posts, read 3,727,958 times
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Judging from their comments, I am assuming they want more cushion for future rate increases. I think the problem is that they just want to see a larger nest egg, which you obviously can't provide at this juncture.

My guess is they feel the increase in monthly fees plus future medical needs may easily rise above your current monthly social security check and without sufficient additional money, you will not be able to afford future costs.

Why not just stay put as long as you can, then enter an assisted living facility of reasonable cost when you get to a point you need help. When your money runs out, you should be able to tap into medicaid to get you into a nursing home. My mom is in a rather nice nursing home in Florida with medicaid help. It is in a very upscale area, and has lots of activities. All nursing homes are not created equal.

Also, Don't know what kind of house you have, but you may be able to lower your expences there by downsizing.

As to generating an additional $800 a month, you would need about $320,000 additional (figuring a 3% withdrawal rate) to generate $800 monthly.

What kind of entrance fee are we talking about for one of these places?

Here's a good article on them. Risks and Rewards of Moving to a CCRC-Kiplinger

Last edited by modhatter; 01-31-2016 at 04:20 PM..
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Old 01-31-2016, 04:30 PM
 
Location: Florida -
8,767 posts, read 10,859,665 times
Reputation: 16640
You did not say how much money you have, but, an immediate annuity of less than $200K would produce the $800 per month you seek. Less available money or a need for greater income will significantly change the dynamic of the necessary return on investment (and risk) will be required. (ie, will $800 per month indefinitely meet your needs, including inflation?)

Of course, another issue everyone faces is rising healthcare costs, although you may qualify for medicaid instead of just medicare, which could make your available dollars go further.

Another possibility you might look into is HUD housing. These are often very nice facilities (sometimes including on-side food service) and typically cost those who qualify about 30-percent of their monthly income.
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Old 02-02-2016, 02:05 PM
 
Location: So.Hills.Co.,FL
193 posts, read 152,367 times
Reputation: 162
Modhatter, would you PM me the name/location of the nursing home your mother is in. I have to start looking around for something like that.
Thanks.
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Old 02-02-2016, 06:19 PM
 
Location: Near a river
16,042 posts, read 18,994,426 times
Reputation: 15649
Quote:
Originally Posted by modhatter View Post

Why not just stay put as long as you can, then enter an assisted living facility of reasonable cost when you get to a point you need help. When your money runs out, you should be able to tap into medicaid to get you into a nursing home. My mom is in a rather nice nursing home in Florida with medicaid help. It is in a very upscale area, and has lots of activities. All nursing homes are not created equal.

Also, Don't know what kind of house you have, but you may be able to lower your expences there by downsizing.

Risks and Rewards of Moving to a CCRC-Kiplinger
Agree. Why go into a CCRC at this point and incur those currently unaffordable monthly fees for so many years?? Wait till you need it. I have a good friend age 86 who has stayed in her home till now and is moving next month to a CCRC, to the tune of $6K or more per month after the buy-in. She may make it to age 100, but even so that's only 14 years paying all that money.

If the OP's home is worth a lot of money in a good area holding value, it may be wise to keep living there rather than downsize now. The pricey home accumulates in value and can be sold just before the move to a CCRC.
Times are uncertain so that's the conservative strategy I would take. Others will differ.
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Old 02-02-2016, 09:40 PM
 
Location: Ohio
1,217 posts, read 2,353,343 times
Reputation: 2214
If you have limited assets you should look into senior rental housing that is priced based on income. My mother found a Jewish retirement complex (she was Catholic) and it was very affordable, well run and neighbors kept an eye on each other. She (and we) never had to deal with the next step (nursing home) because she had a fatal heart attack.

Live your life and enjoy it. You don't know how many years you have. You can plan of course for your peace of mind but you can't plan everything. Start saving your money now and maybe in 10 years you'll have enough for the CCRC, once you go in one you'll never have savings again.
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Old 02-03-2016, 08:53 AM
 
Location: Columbia SC
8,993 posts, read 7,766,040 times
Reputation: 12226
I am a 73 year old widower who has been reading/studying up on CCRC's and I have recently made a decision. While I am going to look at a few of them to see what they are like and what they cost, and I believe I can afford most, I am going to put the decision off for as long as I can. I am delaying the decision as I am fairly active. I play golf 3 days a week. I can easily do household chores. I can and do well take care of myself. I live in an HOA that takes care of all outside home maintenance. I own my home as in no mortgage. I have no (zero) debt. My standard of living is good and my cost of living is easily within my budget. I have a fairly good amount of investments (IRA's, mutual funds, stocks, etc.) to draw form if needed.

Yes I am concerned about the what ifs as I age. Especially reaching a point when I feel I can no longer take as good of care of myself as I do right now. I believe I will recognize the beginning of when I "need help" so until that point, my decision is to keep doing as I am doing and set any CCRC on the back burner.
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