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BABY BOOMERS

MUST ADDRESS
A Look at Some of the Major Concerns Baby Boomers Must Address During the Coming Years

CONCERNS

BARRY D. HOROWITZ
Connecticut Estate Planning Attorney

During the period of time between 1946 and 1964 an unprecedented number of babies were born. 76 million people became a part of the population, and this phenomenon was dubbed the "baby-boom." At that time the population got a lot younger. However, these individuals are now reaching the typical age of retirement. This is resulting in a rather dramatic and rapid aging of the population. There are some 10,000 baby boomers applying for Social Security every day, and there is no end in sight. There should be this many applications accepted by the Social Security Administration for the next two decades or so. Baby boomers are faced with some concerns. Preparing financially for retirement is part of the equation. Understanding long-term care costs is another. And, boomers should understand the importance of incapacity planning. In this paper we will highlight some of the major concerns that baby boomers must address during the coming years.

Retirement Preparedness
There are some short-term mistakes that you can make that actually have a positive impact in the long run. You learn something from these errors, and you are the better for it. However, if you make significant mistakes over a long period of time you may not be able to recover. Many baby boomers are finding that retirement may be elusive because they're not prepared properly. A survey was conducted by the Associated Press along with LifeGoesStrong.com a while back. The pollsters asked baby boomers pointed questions, and 44 percent of them said that they were not confident about their financial comfort during retirement.

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A different poll conducted by the Insured Retirement Institute found that only 40% of respondents were extremely confident about their financial prospects during retirement. One of the reasons why many boomers are unprepared is because they have always had unrealistic expectations from Social Security. This year the average Social Security payout is only $1261 for a single eligible senior citizen. The average benefit for a couple on Social Security is just under $2050 per month. You can't live very well on this kind of money. Some baby boomers are in a position to recover even if they have not planned ahead well. Others simply will not have the time that it takes to make the appropriate corrections.

Assisted Living Expenses


When you are able to get around well and do things for yourself the idea of needing living assistance may seem foreign to you. Unfortunately, this perspective can leave you unprepared when reality hits. If you are under the impression that you will never need living assistance you may want to reconsider. The average lifespan in the United States for people of both genders is 78. Once you reach the age of 65 it becomes likely that you will live well into your 80s. A very high percentage of people who reach this age require help with their day-to-day needs. In fact, 70% of all people of all ages will someday need longterm-care.

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Should you ultimately reside in an assisted-living community or nursing home you are looking at some extraordinary expenses. Here in Connecticut we have higher long-term care costs than the national averages, but even the national averages are attention-getting to say the least. Across the United States in 2012 the average charge for a year in a private room in a nursing home was just over $90,500. In the greater Hartford area this figure is over $149,000. A month-long stay in an assisted-living community in 2012 averaged $3550 around the country as a whole. This factors out to $42,600 annually. Hartford residents paid an average of $4609 per month in 2012, or $55,308 per year. The average length of stay for someone in a nursing home is right around 2.25 years. One out of every 10 nursing home residents will require at least five years of nursing home care. These costs are clearly quite high right now, and they have consistently been rising every year.

Will Medicare Pay?


Medicare is the health care safety net that is provided to senior citizens. We say that it is a safety net rather than a cure-all because there are significant out-ofpocket expenses. And, though most people will need long-term-care, Medicare will not assist with these expenses.

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That's right, you're on your own when it comes to paying for an extended-stay in an assisted-living community or a nursing home. Medicare will assist with up to 100 days of convalescent care after surgery, but that's the extent of it.

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How Do You Pay?


When you combine the average length of stay with the average cost of a year in a private room in a nursing home in Hartford you're looking at a figure somewhere in the vicinity of $300,000. Many people simply don't have this kind of money laying around when they are in their 80s. Attempting to gain Medicaid eligibility would be one possible solution. The purchase of long-term care insurance well in advance of needing the care is another possibility.

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Planning for Possible Incapacity


If you were to become incapacitated and unable to make your own decisions, who would be empowered to handle your affairs? You can answer this question yourself by executing durable powers of attorney. With

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these legal instruments you empower agents to act in your behalf in the event of your incapacitation. If you do nothing, the state could be petitioned to appoint a guardian to make decisions in your behalf.

Conclusion
If you are a baby boomer the eventualities of aging are coming squarely into focus if you are practical enough to keep your head out of the sand. It is possible to take all of the correct steps to prepare for the contingencies that you may face as you continue to enter different stages of life. Those who act appropriately will benefit from their foresight. Those who do not may experience difficulties during their elder years. The best way to make comprehensive preparations for the future would be to sit down and discuss everything with a licensed elder law attorney. Your attorney will gain an understanding of your unique personal situation and help you create a viable strategy for aging.

References
Social Security Administration http://www.ssa.gov/pressoffice/basicfact.htm http://www.socialsecurity.gov/pubs/EN-05-10024.pdf American Bar Association http://www.americanbar.org/groups/law_aging/resources/consumer_s_toolkit_f or_health_care_advance_planning.html MetLife Mature Market Institute https://www.metlife.com/mmi/research/2012-market-survey-long-term-carecosts.html#keyfindings

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About the Author


Barry D. Horowitz
Estate Planning Attorney Barry D. Horowitz is a founding partner in the law firm of Nirenstein, Horowitz & Associates, P.C. He received his diploma from the Loomis Chaffee School and his Bachelor of Arts from Bennington College, where he dual majored in philosophy and music. Mr. Horowitz was awarded his Juris Doctor degree with honors from the University of Connecticut School of Law. While attending law school, Mr. Horowitz received the American Jurisprudence Award in Legal Ethics and the Nathan Burkan Award. After graduation from law school, Mr. Horowitz continued his legal education at New York University School of Law where he received a Post Doctorate Law Degree in Taxation. He has also recently received a national achievement award. Mr. Horowitz is admitted to practice before all the state courts in the State of Connecticut and the United States District Court. He is a member of the Hartford County Bar Association, a charter member of the American Academy of Estate Planning Attorneys, and has recently received the American Academy Award. Mr. Horowitz is also an active member of the Connecticut Bar Association where he is a member of the Elder Law Section, the Estate Planning and Probate Section, and the Professional Ethics Committee. Mr. Horowitz practices exclusively in the area of Estate Planning where he has earned a reputation as a dynamic and entertaining speaker. He also has recently published a book entitled Guiding Those Left Behind in Connecticut. Nirenstein, Horowitz & Associates, PC Living Trust and Estate Planning Attorneys Serving the State of Connecticut with Offices in Greater Hartford, Fairfield County, CT www.PreserveYourEstate.net HARTFORD Gothic Park 43 Woodland St., Suite 520 Hartford, CT 06105 Phone: (860) 548-1000 An Examination of Three Failed Celebrity Estate Plans WESTPORT 191 Post Road West Westport, CT 06880 Phone: 203-221-2617 Nirenstein, Horowitz & Associates