On the one hand I’m proud of myself – I saved enough to afford to move into a retirement home. On the other hand I feel a bit ashamed – I won’t have much money left after I have paid for my unit at the retirement home. I should have saved more. But I couldn’t afford to and anyway retirement and old age were light-years away. As it was, it was a constant argument whether to feed the retirement fund or spending and enjoying the money. I would have loved the extra dinner out every week! So here I am, full of remorse mixed with relief and wondering what the next years will bring.

 

I was a civil engineer. I did fairly well in my small practice. I bought a retirement annuity programmed to kick in at 65, and I worked and waited until I was 68 to collect on my Social Security to maximize my payments. Here and there I stashed small amounts in other savings plans, but we preferred to live well and to spend on things we enjoyed.

 

At the time I set up my plan, it was enough. However, things change. Inflation brought huge changes and then the retirement industry itself grew and became expensive. Today it is a huge and competitive market and prices have soared. I always thought that my large, mortgage-free house would bring in enough to get me into any retirement scheme. Not so.

 

Making the decision to move to a retirement community was a tough one. Deciding on which one was even tougher. These places have mushroomed and each one offers more to attract residents. I decided to live where we can afford to live comfortably and not to try and keep up with Jones. This is the best idea I could come up with to offset the loss of purchasing power I had experienced in my short-sighted retirement strategy. And I’m happy with my choice. We never mixed with the high-flying crowd when I was making the money, why start now?

 

The place we have chosen is in the direction of the town where two of our children and their families live, so it makes it easier for them to visit. As to the amenities, the center offers a medical clinic, a dining room, library, arts center, evening lectures and concerts, a swimming pool and a gym. They run a shuttle bus into the close-by town and there is even a small supermarket on the premises if we wish to eat in. We are going to make this move work for us.

 

We have purchased a small 3 roomed apartment, consisting of a living room with kitchenette, bedroom and a small “study”, big enough for a work space so that I can continue working and writing. So we have started downsizing in anticipation. This may be the hardest part of this whole exercise!

I never gave this subject a thought until I hit my seventies and then watched my friends drifting into retirement homes, frail care centers, Alzheimer’s homes and other such places. Then I went from not thinking to sheer panic overnight. In the morning we rushed over to a retirement home and checked to see what it was all about. Three hours later we left, feeling elated to know that we could be looked after and depressed to discover that we could hardly afford such a place.

 

Retirement homes are expensive, period. First you have to acquire the apartment at an expensive purchase price. As the retirement home industry burgeons so the cost of apartments rockets. Then you have to pay a monthly maintenance fee which covers many of the amenities but excludes food and a caregiver. Sure they have clinics staffed by nurses, dentists and other medical people and will call an ambulance to rush you off to the hospital but your own private caregiver, the one who feeds, dresses and bathes you, is your own private business.   

 

The Community Living Assistance Services and Supports (CLASS) program, a part of the health-reform law, established a national, voluntary insurance program for purchasing community living services. It was designed to expand options for people who require long-term help. But in mid-October, the Obama administration shut down the program, saying it was not financially feasible. Last week, a panel of long-term-care experts tried to answer the now-what questions raised in the wake of that decision. Among them: What can those who were likely to benefit from the CLASS Act do now to pay for their current or anticipated long-term-care needs? How can the country deliver and finance long-term-care for its rapidly aging population? What role will providers play as Medicare and Medicaid payments are cut?

 

These are legitimate questions that must be addressed, said Howard Gleckman, a resident fellow at the Urban Institute. "We are in an era of funding constraint by the government that will get worse long before it ever gets better. The question is: ‘Why don’t we confront it?’"

 

What’s more, the cost of long-term-care itself is not trivial. Nursing homes cost on average $87,235 annually, according to a 2011 MetLife study. One year in an assisted-living facility is now $41,724. Adult day services are $70 per day, and home health aides cost $21 per hour. At the moment, the options for paying for long-term care are limited. Medicare doesn’t cover all that much and just 12% of adults age 65 or older have private insurance, according to the Urban Institute. As a result, many families pay out of pocket until they exhaust their resources and turn to Medicaid.

 

Is the answer to start rationing long-term care? "The dirty little secret is that we do that already," Gleckman said. He said health-care professionals often find elderly Americans dead in their house for a week or more. “Working-class people don’t have any insurance. They don’t have any savings. One of them gets sick, the other one has to take care of them for as long as they can, and then one of the spouses dies and what happens?