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Old 09-14-2014, 06:31 PM   #21
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We've had this discussion at the office. Boss and I are both 50 and at the very tail end of baby boomers. His theory is based upon supply and demand that demand will be dropping and prices as well. Not sure if that's a great plan but raises an interesting point.


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Old 09-14-2014, 06:44 PM   #22
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My Dad's assisted living facility was around $4600/mo when he moved there in 2012. That's for a 1BR, they also have a studio unit that is around $3700. Every 12 months there is a 3% increase. The basic charge includes assistance with dressing and bathing if needed.

A few months ago he also started needing more help with medications and that added $150/mo. Some places charge for each extra thing you need, his place steps up for a group of needed assistance.




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Old 09-14-2014, 06:54 PM   #23
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Still wondering what a reasonable $ number is for a person 20 to 25 years out. I guess I'm still thinking a $1 million per person (plus Social Security to help defray costs) ought to be a more than a reasonable amount in 2035 (2040) dollars to cover Assisted Living if needed.

That works out to approximately $250,000 a year for five years...
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Old 09-14-2014, 07:24 PM   #24
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Honestly, the only people who check into expensive assisted living places are the people who have the money. There are many other ways to get care. For example, my mom went to a board and care - 2K per month. She got full care in a home like atmosphere, meals, bathing, etc. We were happy to have her there. My dad just went into assisted living - he looked at about 4, 3 were new and super expensive like you mention 5K per month. But we found one that was older, an apt building converted to assisted living, and he has a large one bedroom with a balcony for only 2300 per month.

My grandparents - we brought in a woman who with her sister (they traded off) lived at their house and cared for them 24/7 for only 5K a month (for both). We supervised them as needed. they were great!

Just saying I would not get hung up on thinking you need 7 years of expensive assisted living. Most families try to keep their loved ones home as long as possible.
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Old 09-15-2014, 03:08 PM   #25
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I don't have a clue how much to budget for future increase in assisted living expense. I hope the 6-8% increase that we have been seeing in the past doesn't prove accurate but I fear it may.

I will say that when figuring out how much to put in reserve for my 89 year old mom. I realized that what matters is your incremental expense not the total. So for instance my mom and her partner have a lovely independent living facility for $4300 including all meals and lots of activities. Her share and additional expense are relatively modest and include $400/month for the great grandkids say $3500. We now have a great healthcare worker come in almost daily to assist her and we are spending almost $2,000/month. A full nursing home facility is about $7500-8000/month. So the incremental cost is $4500 when I first planned it and only $2500 more than we are spending now.

Since this could come anytime in the next 5 years I put in 2 years of additional cost $120K in the Vanguard short term bond fund, and then managed the rest of the portfolio for the benefit of her heirs.
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Old 09-15-2014, 07:29 PM   #26
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Perhaps not in the next several years, but looking ahead, I would forsee the increased need as the population ages, causing the supply/demand factor coming into balance, and expect that future costs to be less than the inflation factor.
The economies of scale, the improvement in the utilization of technology, and the natural growth of an industry which growth is so early foreseen, should optimize the services that today are very labor intensive, and (as a bad/sick analogy) drop the price of care and maintenance, much in the way that private prisons have reduced total costs for incarceration.

In our area alone... a rural/metro that services may small towns and villages Metropolitan area - Wikipedia, the free encyclopedia

... our local "senior facilities" exposition has gone from featuring 4 senior living facilities, only three years ago, to twelve this past week.

At the same time that the public industry grows, so too, should we expect more refined versions of the Japanese model of senior care at home... either a one on one in-home 24/7 care, or the growing concept of the mother-in-law apartment/room.

We live in a CCRC, that has assisted living, rehab apartments, nursinghome, and Alzheimers units. In just the 10 years that we have lived here (in a regular single villa/home), we have seen a quantum leap in efficiency of care, while maintaining the professional/personal care. Better training, learned efficiencies of scheduling and better management have slowed the expense factor, so that prices have remained relatively stable for the past three years.

Technology that personalizes needs and things like diet, medication and personal care schedules allow for food, medical, and specialized requirements to be effected without excessive labor expenses. The newer building design maximizes space and movement while providing more social interaction.

We had a good chance to see simple example of the efficiencies last week, when there was a Music entertainment show in the "auditorium" . An audience of about 80, was brought in (perhaps 20 in wheelchairs) and seated in less than 5 minutes. Wide aisles, a scheduled movement plan, seating plan, space for serving cookie and cocoa to all, and then returning all to their rooms was accomplished with 5 aides, with excellent efficiency and no confusion or upset.

Since we had also seen operations in Florida with a similar size (several years ago), we we mightily impressed with the contentment of the residents, and the excellent care given by the employees. All in all, a happy facility.

The OP asked for a look ahead at costs. Not only do I see a leveling off, but I also see a general improvement in the care of the residents. We have no fear of the future, if we should have to enter assisted living or nursing home care.
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Old 09-16-2014, 02:20 PM   #27
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I'm sort of with BellBarbara, but thinking about it a little different. There is a thread over on bogleheads about LTCi (Long term care insurance) and how people might be trying to protect themselves from something that has a very small chance of happening. The odds that both you and your wife would need 5 years of care is VERY small. Even the odds of just ONE of you needing that is very small. It is good to plan for contingencies, but also to think about what the worst that could happen is - Medicaid? It's not like you'd get thrown out on the street.

Of course it could happen - one grandmother was in a nursing home for 14 years! But, none of the other 3 needed assisted living at all. I want to have some protection, but not try to have so much that I can never reach that goal!
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Old 09-16-2014, 03:08 PM   #28
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Quote:
Originally Posted by kaudrey View Post
I'm sort of with BellBarbara, but thinking about it a little different. There is a thread over on bogleheads about LTCi (Long term care insurance) and how people might be trying to protect themselves from something that has a very small chance of happening. The odds that both you and your wife would need 5 years of care is VERY small. Even the odds of just ONE of you needing that is very small. It is good to plan for contingencies, but also to think about what the worst that could happen is - Medicaid? It's not like you'd get thrown out on the street.

Of course it could happen - one grandmother was in a nursing home for 14 years! But, none of the other 3 needed assisted living at all. I want to have some protection, but not try to have so much that I can never reach that goal!
We are all fighting old battles in some way or another.

Normally I would agree odds are low, but I just went thru seeing both parents in an assisted living facility (one for 5 years the other for 7).

That having been said, my experience in life is that it is never the thing you think that gets you... so hopefully setting aside funds will mean it won't be a problem.
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Old 09-16-2014, 03:38 PM   #29
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FIL was in a nursing home for 8 months before he passed. It was a mid-range place (clean and nice, but not new and fancy). In Kentucky... it ran $5k/month plus extras - most months was about $5500. (Extras were copays for prescriptions, etc.) This was for a shared room.

We are looking at memory care units for MIL currently. In Kentucky, they run about $6500 for a private room. She wants to be in PA - and in the Philly metro area - it's closer to $8k. In both cases the places are clean/nice... but older facilities, not fancy. Fancy places cost quite a bit more.

My step mom just moved to an independent living apartment at a place that has assisted living offered as well. For her, the rent is $5200. She's paying extra because she insisted on an ocean view apartment. (View is a distant view - but similar to the house she just sold.) If she were across the hall she'd be paying about $4000 for a non-view apartment.

My husband is working (he flunked retirement) on a project at a local high-end continuing care facility. It is a very fancy place with buyins of over $100k. A friend lives there as well so I asked about the rent. After the buy in she pays $4800/month for a 1 bedroom plus den. She's still very independent. But they don't raise the rent more than a fixed percentage when you switch to assisted living or nursing care. They have a very nice memory unit as well. Fortunately, she's got a very nice pension so she can swing it. If money were no object, that's where I'd move... it's a walkable area (adjacent to a mall) on bus lines... so while independent, it's a good spot.

Our plan... We have a paid for house in a very expensive area. Proceeds from the house will pay for many years of care. Our next door neighbors are facing this right now - he's got dementia, she's having other physical issues and in-home care isn't cutting it. It reached they are in process of moving to a CCC nearby (less fancy, but nice) and will be putting their house on the market. I've had long talks with their adult kids. (I grew up with them, since I bought my parents house). It's very stressful to the parents. The kids are a bit overwhelmed trying to manage the move for their parents.
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