Here is a helpful guide for national and local resources that can help senior citizens make sound financial decisions or seek assistance with aging issues.

General Information AARP < www.aarp.org > Social Security Administration <www.ssa.gov> or 1-800-772-1213 Society of Certified Senior Advisors to locate a Certified Senior Advisor (CSA) in your area < www.society-csa.com> Women’s Institute for a Secure Retirement (WISER) the nation’s only non-profit organization wholly devoted to providing women with the crucial skills and information they need to improve their economic circumstances and plan for a financially sound retirement. <www.wiser.heinz.org> Catholic Charities’Primary Offices Fond du Lac 191 S. Main St. (920) 923-2550 Kenosha 6202 - 25th Ave. (262) 658-2088 Milwaukee 2021 N. 60th St. (414) 771-2881 Racine 2711 - 19th St. (262) 637-8888 Sheboygan 503 W. Wisconsin Ave. (920) 458-5726 Waukesha 741 N. Grand Ave. (262) 547-2463 Department on Aging Milwaukee (414) 289-6874 Ozaukee (262) 284-8120 Washington (262) 335-4497 Waukesha (262) 548-7828 SE WI area agency (262) 821-4444

The concept of “retirement” is changing. The dividing line between work and retirement is becoming blurred, as the first members of the baby-boomer generation begin to retire.

No longer is retirement the period of idleness before death, something old people do. More and more it is seen as another stage of life, a potentially enriching one in which work and retirement are not mutually exclusive.
In a survey by the National Council on Aging, only 58 percent of adults over age 65 consider themselves “retired” in the traditional sense. Twenty-three percent classify themselves as “retired and working,” while 19 percent say they are not retired.

A meaningful retirement takes a lot of planning. The good news is the amount of money one has (which is often not in our direct control) takes second place when it comes to happiness in retirement. Studies have shown those who are most content in retirement are those who have carefully planned their retirement (which is under our direct control). Taking the time to create a realistic plan is more critical than the actual amount of money you have. Determine today to take control of your financial future. Just by getting started, you are overcoming one of the biggest hurdles.

Start planning early for retirement

The average age of retirement today in the United States is 61 for women and 62 for men. Because you can expect to live 20 to 30 years past retirement, it takes a lot of money to fund all your retirement years. The earlier you start planning, obviously the better off you will be, because you will have more options.

If you are married, it is important that you and your spouse work together and agree on whatever decisions you are going to take. It is especially important for women to have a good grasp of the couples’ financial plan, since while three out of four older men live with their spouses, only half of older women do.

Social Security is a safety net providing a financial foundation for retired workers, and covering more than 90 percent of the workforce. According to the National Council on Aging, 72 percent of people surveyed said qualifying for Social Security was the most important factor in their decision of when to retire. It is the sole source of income for 20 percent of retired Americans, and the main source for 63 percent of the households receiving retirement benefits. Most people, however, need other financial resources to live comfortably. In 2005, the average monthly Social Security payment for retired workers will be $950.

Besides Social Security, the other sources of fixed income retired people count on are pensions and post-retirement wages. Neither of these, however, is as dependable as Social Security benefits. In recent years, many employers have modified their approach to traditional pensions. No longer are they guaranteeing a regular income for life to retired employees. Instead, the employer may offer a “defined contribution plan” in which they put money into pension funds without guaranteeing the benefits employees receive in retirement.

Investments, real estate holdings

Investment income is the other main source of income for retired people. This includes income from savings, tax-deferred retirement plans such as 401(k)s and IRAs, and other investments you have built up over the years, like real estate.

If you are completely clueless about investment options, you are not alone. Many people turn to financial advisors to help them decide where to invest their money, whether it is $1,000 or $10,000 or more. Be sure to look for Certified Financial Planner (CFP) initials after the advisor’s name, indicating the agent has been certified by the Institute of Certified Financial Planners, guaranteeing they have taken a minimum number of courses, and passed required exams.

Look for people who are willing to spend time with you explaining how investments work. If you find yourself confused by an advisor’s explanations, find another advisor. Most advisors are very competent, and will be an asset to your financial planning.

Financial planning not an option for all

However, not all older adults have the luxury of financial planning, observed Bill Leon, director of ministry on aging for Catholic Charities, and therefore they are left with few options today. Leon works with groups assisting older adults in solving problems related to safety and independence.

A common misunderstanding, he said, is that people think other services are available to elderly people to supplement what Social Security does not cover; that another government program or their church will fill that gap. “They’re surprised to find there’s no other safety net,” he said.

“ People who’ve had the opportunity to plan ahead financially can use their investments to purchase long-term care insurance,” Leon said, “or use the equity in their homes to pay for needed care.” Those without money have few options besides spending their remaining personal assets, he said, then going on Medicaid (Title 19), a welfare program funded by state and federal governments.

The major drawback to being on Medicaid, he said, is that it severely limits your choices of long-term care to nursing homes that will accept Medicaid patients, and often leaves you with no residence to return to if your condition improves.

An estimated 60 percent of Americans will require long-term medical care at some point in their lives, and the costs of a nursing home or assisted living facility are tremendous.

“ Many people mistakenly believe that Medicare will pay for this care,” said Leon. That is not the case. In fact, various studies show that Medicare pays for just 16 percent of all long-term care in America today.

Long-term care challenges

Common medical conditions requiring the services of long-term care facilities or home health care include heart disease, diabetes, forms of dementia such as Alzheimer’s, arthritis and strokes. Stroke is the leading cause of disability among elderly people in America.

What you will often see, according to Barbara Horstmeyer CSA (Certified Senior Advisor), is the situation of Dad caring for Mom — who has dementia — in their home without outside help. They may be lower to middle income folks without many assets. Things go OK, she said, until Dad is diagnosed with terminal cancer. Neither Dad nor his out-of-town children know what to do next.

It is at that point many families will contact her, said Horstmeyer, who is Prime Financial Services’ director of senior planning. With the assistance of social workers, geriatric case managers, elder law attorneys and nurses, she helps families to explore the options available to them.

“ Maybe Dad and Mom only have $30,000 in savings for their retirement, but they own their home, which is worth $120,000,” she said. That gives them the option to place Mom in an assisted living facility (which neither Medicare nor Medicaid cover) while Dad is still well enough to help with the selection, said Horstmeyer. This allows him peace of mind in his final days, which may be spent in a hospice.

“ I encourage families not to wait until there’s a crisis to plan for long-term needs,” said Horstmeyer.

Earlier transition may be better

They may find a facility where they can remain together, allowing an easier transition. When the husband’s care needs become too great, he may be able to transfer to another portion of the same facility. The couple could at least remain under the same roof, if not in the same room.

Each estate is different, said Horstmeyer, and needs to be looked at individually. The first thing she does with a new client is to help them inventory their assets. She encourages families to keep one another informed on where their financial records are kept.

“ If parents don’t want their children knowing the details of their finances, that’s OK,” said Horstmeyer, “but it’s a good idea to let them know where these records are kept, in case something comes up.”

Oftentimes, a new widow does not know where her husband has their money invested until she receives the 1099 statements in January’s mail, she said.

About 50 percent of the time the older adult’s children initiate the request for Horstmeyer’s service. At times, she said, the children are concerned about protecting their parents’ assets. She strongly discourages “gifting” as a means to protect assets. She explained that people mistakenly believe it is good for parents to give their assets to their children, and then go on Medicaid to pay for their long-term care.

She said “gifting” to avoid using assets to pay for long-term care is not a benefit to one’s parents; it is a burden and a dishonor to those parents.

Community Options Program

After inventorying the senior adult’s assets, Horstmeyer helps them find ways to obtain needed care, based on their ability to pay and county in which they live.

“ The counties each have their own benefit specialists and programs they administer,” she said.

Every county in Wisconsin also has a Community Options Program (COP), whose purpose is to help people needing long-term care stay in their own homes with appropriate support. COPs help people find needed services, and for those meeting income guidelines, pay all or part of the costs.

Again, Horstmeyer emphasized the need for planning, noting that a recent application she sent on behalf of a client in October to Milwaukee County’s COP took until January to be processed.

“ Plan in advance,” Leon stressed, “even if the advance planning is just designating durable power of attorney for health and finances. It is better for people to make these choices when they have all their faculties.” It gives you more control over where your life is going amid losses of money, friends, family and health, he said.

Do not think just of nursing homes when it comes to retirement planning, warned Leon.

“ Ninety-five percent of retired people are trying to make a go of it in a non-institutional setting. People in their 50s and early 60s still have time to do some serious planning. Older people have fewer options, but there are still some decisions to make.”

Leon said Catholic Charities can help by offering guidance with a faith perspective, and providing links to community agencies that offer services to older adults.

“ Some older adults discount themselves as having anything to offer society,” said Leon. “This is not so; they have time and wisdom. Even the homebound have things to offer, whether it is prayer for their parish, or a smile for the delivery person. They need to know God has purpose for them yet.”