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Planning ahead for elder care is a crucial aspect of financial planning that often gets overlooked. Kick off your journey towards securing your financial future with this latest episode - a conversation with seasoned Financial Advisor, Holly Carroccio, CFP. In this discussion, we explored the intricacies of elder care and long-term financial planning. Holly, with over 34 years of experience, divulged invaluable insights into the significance of long-term care insurance, estate planning, and being prepared for life's unexpected twists. Discover how to navigate the challenges of balancing financial responsibilities, caregiving, and planning for your own future. Learn from Holly's wealth of knowledge as we unravel the complexities of insurance, retirement planning, and caring for aging parents. If you find yourself in the midst of deciphering these financial intricacies, this episode is a must-listen. Holly's expertise and practical advice will empower you to make informed decisions and take proactive steps towards securing your financial future. Tune in to gain the insights needed to make wise choices and navigate the path toward a financially stable and fulfilling second season of life. Take charge of your sleep after 40 with my FREE E-BOOK! Learn "The Exact Steps it Takes to Restore Sleep" and start making real changes now! https://bit.ly/4cblYcT TRANSCRIPT Links to articles and documents referenced appear at the end of the interview text. Betty Murray: All right, Holly. So I, as I said in my introduction, you know, Holly, and I had this conversation and I was like, this is something we have to talk about. So, for anybody that has not listened to menopause mastery before. My mom went through a heart attack and stroke last year, and you know, one of the most valuable things is she made it to 88 going on 89 And that was her first time to be in the hospital, but it was a catastrophic heart attack and stroke and she went from basically living on her own doing everything to basically not being able to do activities of daily living. So, to say I was thrown into and immersed in this world of elder care would be putting it mildly. And to be honest, my parents did a lot to plan for it, but the amount of disruption in my life and what it would take as far as managing it was and still is overwhelming. And Holly has so much to give here, as a woman in this world, and I was like we have to have this conversation. You know, the other thing, Holly, I can tell you that after 20 years in practice, every woman I see is either doing it or will be doing it or has done it, period, end of sentence. We will spend our life taking care of others. And this is a big part of it. So, this is an important conversation. I'm so happy to have you. Holly: Thank you glad to be here. Absolutely. I think it's a great topic and so important. Betty: Yeah, so Holly I know you're a Certified Financial Planner and you obviously love working with individuals and especially business owners. How did how did you pick that as like this is what I'm going to do what did you always want to be in this world? Holly: You know, I get asked that question a lot. And I think the start of it was when I was in college, my dad went through a major financial setback right in the middle of college because there was a recession in the eighties in real estate. And he notified me that hey, you're on your own financially. From now on, and I was like, "Oh my gosh", what am I going to do? How, how will I pay tuition, et cetera. And it just made me realize how things can come out of nowhere in life and how important it is to plan and so that became a very laser focus for me, and I was a finance major already. And I just thought, you know, I really want to help people that are struggling making financial decisions and I work a lot with entrepreneurs to who put all their money back into their company and I think that's okay. And it is until it isn't. And so, I really like helping business owners and just people in general prepare for their future. Betty: Yeah, yeah, I think it's, I have a lot of friends that are like, you know, I'll just stick my head in the sand and I'm just going to you know, pretend it's not there. I am like, it's really important. Holly: Yeah, it's coming, someday your future will come. Betty: It's kind of like menopause. You don't get a pass on menopause. You don't get a pass on the future. Let's dive in. Because like I said, this is this is such an important topic. So, what are some of the things that a woman that may be in this time period of life, maybe she hasn't done a lot of planning? Or, you know, the other thing that I find too, is often if their partner they sort of let the partner do the planning, and they're not necessarily involved, which is equally as frightening to me. But what are some of the things women in this time period of life really need to start thinking about? Because we're a little bit probably behind the eight ball if we haven't done anything. Holly: That's true. That's true. So, of course, retirement planning is important and if people are working with a financial professional, that's probably one of the main things that they're focused on. Where I see a lot of gap is in the risk management area, and in estate planning. And so, a lot of financial professionals focus in more on the wealth management and investing. But risk management is important because it doesn't matter if you're worth $500,000 or $5 million. If you have a risk come out of nowhere. It can really destroy your financial plan. And so, one of those risks is that we live a long time and longevity is great. You know, especially if they do all the things that you recommend and stay healthy. But you know, the double-edged sword of that is if you live long time, you may end up being frail and need help or you may have some morbidity issue late in life where you need care. And care is extremely expensive. It can run anywhere from 6005 to 21,000 a month1, depending on where you need it. How much you need it. Who's doing it, etc. And so, if we don't prepare for it, a lot of people assume, "Oh, Medicare covers that, or my health insurance covers that". Or if I don't have any money, Medicaid will cover it. And so, and I can explain a little bit more some of those things. But, you know, and not only our care, but if you're young enough to think about your parents and have those open conversations with your parents. That's really important too because that risk can also fall on us. If our parents haven't prepared. Betty: Absolutely. I mean, it's the average woman will spend 18 years caring for elderly individuals, statistically, and at least one of those I'm sure there's a bunch of different variables, but if your family hasn't prepared, you know, could be a leading cause of loss of work for the woman taking care of them or you know, loss of income or loss of their own health. Yeah, I'd like for you to explain because I think people do you said like, oh, Medicare will pick it up or my secondary health insurance will pick it up or if I don't have enough then Medicaid will kick in. And that's absolutely not true. And I think it's important to kind of share where those caveats are, so people understand. Holly: So, the basics are, Medicare will cover the first up to 100 days of skilled care2. After a hospital stay. And my mom is a perfect example of that. She fell backwards last year and broke several ribs. And after she was in the hospital for a few days, about actually a couple of weeks. They moved her to skilled nursing rehab, and she was there for about two months and Medicare took care of that. And then she also had a Medicare Supplement. So, the Medicare Supplement picked up where the where Medicare left off. Where it started to cost money is when we got home, and I thought we would have the full 100 days. But we didn't. They basically said no, we've done all we can do for you. It's time for you to go home. And she still wasn't able to live independently at that point. And so, we had to hire a home caregiver at that point. Some other scenarios are, you know, Medicaid, which kicks in really once most of your financial resources are gone. And my mom's case with would not have helped her my mom doesn't have any net worth at all. So, you know, technically she, in certain circumstances she could qualify for Medicaid. The problem is Medicaid. Doesn't pay for home care. It also doesn't pay for assisted living. So, someone has to be really needing pretty severe levels of care before Medicaid is going to help them. And so, you know, having something to bridge that gap is extremely important. Betty: Oh my gosh, it is it is extremely important. And I don't know if your experience was like mine, but you know, my mom was in skilled living same thing, you know, had a stroke last function on the right side couldn't do any activities of daily living, and they and you would get a call like that day and they're like, your mom's going to be checked out tomorrow. Exactly. They don't get you noticed. No, they like, like, the social workers are like we're going to handle this. No, you don't. I was I was in Florida at a conference. The first time I left for just a few days because I had to do this professionally. Fighting with people on the phone. I was like, "you can't kick her out. I am not there." I was like, at that point. I'm like, "I'll pay; I don't care. You can't kick her out. I'm not home". So, it's not a good experience to have now. I think Medicare isn't going to help you in any way. Holly: Exactly. Well, the other thing that happened was I thought my mom based on the picture they painted in the beginning, I thought she was going to be really pretty functional by the time she got out. And the physical therapy was pretty lame. And this was in a very high-quality facility. Very highly renowned, expensive etc. And she wasn't even close to being back to where she was when she left. So, we were very ill prepared. Betty: Yeah, I would, I would agree. My mom was at one of the best facilities and they were like, "Oh, we're going to get her up and walking" and I was like, "yeah, she's 'Yeah, I can't do anything'." After two and a half months there, it was just "Yeah, it was it's not all rainbows and you can't believe those statistics and how that how that's going to look". So, let's so let's get into the planning part. So, I think we painted a scary picture. So, what are some strategies that women can really employ to balance the financial responsibilities of caregiving and their own retirement and elder care planning? Like let's kind of throw some things out on the table, because most of us don't really know what we need to do. Holly: One of the first things to consider is insurance. Because the whole idea of insurance is you're transferring that risk from yourself to the insurance company. And let's face it, nobody likes insurance. It's often an expense where you don't know if it's worth spending that money or not. And we buy car insurance and home insurance because we're required to, but we often don't answer some of the bigger risks in life, whether it's life insurance or disability, which is a potential loss of income when you have an accident or illness. And disability insurance is very important. But once you're beyond the working heirs, you can have long term care insurance as well. But it's one of those things that you have to plan way ahead because number one, you have to be healthy enough to qualify for it. And the longer you wait to buy it, the more expensive it is. Because as you get older it's more expensive because you're closer to the potential risk. So, the analogy I always give people is it's kind of like if you were trying to insure your house, but the garage is on fire. Probably going to be difficult. Right? So, you can actually think about buying long term care as early as 40. But I would say you know, there are plenty of people that wait until their 60s and it's not necessarily too late. It just gets a lot more expensive. So, if people are not insurable, then there's some other strategies, you know such as insurance with riders, you can sometimes be insurable for a life insurance policy, even if you're not insurable for long term care, because the criteria for getting those two types of insurance is different. So, you might qualify for a life insurance policy even if you don't qualify for long term care. So that's a secondary option. And then thirdly, there are some annuities out there that will supplement the cost of long-term care if you're not insurable at all. So, you know, those are those are some basic things just to try to offset the cost. And then there's also some legal things that you can do as well3. That, for example, having things set up where people can do things for you like having a durable power of attorney, where people can sign things for you. And obviously, you want a very, very trusted individual. You don't want somebody that might take advantage of you. And unfortunately, children sometimes do take advantage of their parents and family members do take advantage of their parents. So, you got to be really realistic about you know, what is the character of this person, what is their financial acumen? You know, just really thinking through the maturity of the person and then also having a medical power of attorney so that in physicians directives so that you can actually work with the medical team, get the information you need to help them make decisions, and, and also the authority to make decisions on their behalf. Betty: Yeah, I think, you know, as somebody I mean, I'm thankful I'm in the medical field and so I have an incredible command of what's happening in a hospital you know, way more than the average person and you know, I'm thankful my parents were actually heavy duty planners, to the extent that I was always like, can we stop talking about your death? Your Will, your long term care, like every day, they'd be like, you're going to…what is it, what is it? But I will say, even being highly prepared, it is a lot because not only are you probably having to all of a sudden make financial decisions and find out whether you have the financial capacity to do the things that you need to do. But you have to be an advocate in the healthcare system that is not really constructed to be positive for anybody in that experience. The most scary thing is to go to the hospital with somebody in a critical environment, because I just feel like our western medicine system conventionally is kind of broken. So, if you don't have somebody there, that's like hardcore advocate that is going to demand there's just a lot that can go wrong. And now you're having to do both. And I think that's what's really hard is especially as women we're going to be like, all of a sudden, we're the fiduciary financial planner, all this other stuff. We're taking care of the house, we're taking care of the bills, taking care of everything else. And oh, by the way, we're now Doogie Howser doctor. Got to figure this out because we have to also be their healthcare advocate. And it is it is a lot. Holly: Yeah, advocacy is so important. And I knew that in the back of my mind, but actually living it was a whole different thin…
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