How Can you Pay for Long Term Care with an Ailing Economy?
By jana on May 18, 2008 in Long Term Care Insurance, Reverse Mortgage
An article out of USA Today highlighted the problems of retiring in an ailing economy. The usual culprits of decreasing values of retirement funds, decreasing homes values and rising prices of consumables were the big three for this article. “Americans need to face a sobering fact: They’re not likely to have as much money for retirement as they’d projected. Which means that many of us will have to save more, expect less and work longer than we’d planned.”
With that said, the article continues by saying that most Americans are sorely behind in their savings for retirement. The statistics they reported indicated that 36% of working Americans over the age of 55 have less than $25,000 in retirement savings. Not enough to retire on let alone if there is a major health event. Health care costs rise faster than even inflation does. So this means that even if inflation has been taken into account for retirement plans, a major health event could still suck those savings and retirement funds faster than planned.
The article was even more pessimistic when it talked about Reverse Mortgages as an option for retirement. It mentioned Yale economist, Robert Shiller, as beleiving that home prices could possibly decline by 30%. Wit this scale of decline, there is no equity left to do a Reverse Mortgage. Downsizing is all that is left…
This artilce seemed all doom and gloom. We all see the problems out there…has anyone seen someone with solutions?
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