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Baby Boomer Generation Largely Unprepared for Retirement

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					Baby Boomer Generation Largely
Unprepared for Retirement




                                  Roy W. Litherland
                             www.attorneyoffice.com
    http://www.attorneyoffice.com                 1
                                      February 2013
                       Baby Boomer Generation
                               Largely Unprepared for
                                     Retirement
                        One of the most poignant demographic trends that we are seeing in the United
                        States today is the rapid aging of the population. This is due to the fact that
                        members of the baby boomer generation are starting to enter their senior years.
                        "Baby boomers" are Americans who were born between 1946 and 1964, and
                        there are approximately 77 million baby boomers in the United States. This is

       The average      resulting in approximately 10,000 people applying for Social Security every
                        day.
benefit for a single
 individual in 2013     Can You Retire Comfortably on Social Security Alone?
     is estimated at
                        While it is true that the vast majority of senior citizens are going to be
 $1,261 per month.
                        collecting Social Security benefits when they reach the age of eligibility, Social
       The average
                        Security payouts are modest. The average benefit for a single individual in 2013
      benefit for an    is estimated at $1,261 per month. The average benefit for an eligible couple is
  eligible couple is    $2,048.
$2,048. This type of
                        Many people have rather lofty retirement goals, envisioning a life of leisure and
money is not going
                        travel. When you look at these average monthly benefits, you can see that this
  to finance a truly
                        type of money is not going to finance a truly comfortable retirement.
       comfortable
                        Even those who receive more than the average are not going to be able to enjoy
        retirement.
                        true financial freedom. The maximum monthly Social Security benefit in 2013
                        for a single retiree is just $2,533 per month.

                        In spite of the limitations of Social Security, according to the Social Security
                        Administration 74% of single people who are enrolled in the program rely on
                        Social Security for most of their income. 53% of married senior couples derive
                        more than 50% of their income from Social Security.


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                            46% of single senior citizens rely on Social Security for at least 90% of their
                            income, and this is true for 23% of the married couples who are receiving
                            Social Security benefits.


                            Many Boomers Polled Not Confident

                            There have been several studies conducted recently in an attempt to measure the
                            retirement preparedness of baby boomers. One of them was conducted by the
                            Associated Press in partnership with the popular website LifeGoesStrong.com.

                            Some 44% of the baby boomers polled stated that they were not confident they
                            would have the financial resources that they needed to enjoy a comfortable
                            retirement.

                            A similar poll was conducted by the Insured Retirement Institute, which is a
                            nonprofit organization serving the insurance industry. This poll involved 803
                            people between the ages of 50 and 66. Only 40% of the people who participated
                            said that they were extremely confident that they would be able to retire
                            comfortably.

                            Two thirds of the respondents to the Insured Retirement Institute's poll said that
                            they were not confident about their ability to handle all of the medical expenses
                            that they anticipated during retirement. 75% of them did not feel as though they
                            were prepared to address potential long-term care costs that they may incur at
                            some point in the future.


                            Long-Term Care Costs

  Law Office of Roy W.      According to the United States Department of Health and Human Services,
       Litherland           once you reach the age of 65 there is a four out of ten chance that you will
3425 S. Bascom Ave, Ste .   require a stay in a nursing home at some point in the future.
240, Campbell, CA 95008
     408-356-9200           Most people who reach this age will need some type of living assistance
roy@attorneyoffice.com      eventually.



                                      http://www.attorneyoffice.com                                           3
                             Each year the MetLife Mature Market Institute puts out a survey on the current
                             state of long-term care costs. In 2012, the average annual expense for a semi-
                             private room in a nursing home in the United States was just over $81,000. A
                             private room averaged $90,520 annually.

                             The U.S. Department of Health and Human Services tells us that 10% of people
          Many baby
                             who need nursing home care will stay in the nursing home for at least five
  boomers have not
                             years.
     planned ahead
 appropriately and           Will Medicare Pay for Long-Term Care?
they may be forced
                             Medicare will certainly be of great assistance to baby boomers who need
to pay a hefty price.        medical treatment as senior citizens. However, this program is not set up to pay
                             for an extended stay in a nursing home or assisted living community.


                             Are There Other Options?

                             Though Medicare won't pay for long-term care, Medicaid (which is called
                             Medi-Cal in California) will in fact pay these expenses if you can obtain
                             eligibility for the program. There is an upper asset limit of $2,000 that you must
                             stay within, but everything that you own does not count toward this limit.

                             Your home (up to a 2013 maximum equity limit of $802,000 in states with high
                             property values such as California), certain personal possessions and your
                             vehicle are not considered to be countable by the Medicaid program. And, the
                             healthy or “community spouse” may keep half of shared assets up to a
                             maximum of $115,920 in 2013.


                             Conclusion
   Law Office of Roy W.
        Litherland
                             When you look at all the facts, you come away with the realization that it takes
 3425 S. Bascom Ave, Ste .
                             careful advance planning to prepare for your active retirement years and
 240, Campbell, CA 95008
      408-356-9200
 roy@attorneyoffice.com


                                       http://www.attorneyoffice.com                                        4
                               the twilight years that will follow. Clearly, many baby boomers have not
                               planned ahead appropriately and they may be forced to pay a hefty price.

                               The wise course of action is to devise a cogent plan for the future with the
                               assistance of a licensed and experienced attorney who has a background in elder
                               law, retirement planning, and estate planning.

                               Your lawyer will gain an understanding of your retirement and legacy goals,
                               evaluate what is realistically possible for you, and create a cogent plan that
                               leads to the fruition of these goals.

                               If you go forward living in the moment without expert guidance, you may be
                               among the many who will never be able to retire.


                               References

                               Social Security Administration
                               http://www.ssa.gov/pressoffice/basicfact.htm
    About the Author
                               Forbes
                               http://www.forbes.com/sites/janetnovack/2012/10/16/social-security-benefits-
                               to-rise-1-7-workers-face-up-to-2425-payroll-tax-hike/

                               AP/LifeGoesStrong.com
                               http://www.prnewswire.com/news-releases/ap-lifegoesstrongcom-poll-reveals-
                               44-of-all-baby-boomers-are-not-confident-that-they-will-retire-comfortably-
                               119247894.html
Roy Litherland is certified
                               Financial Security Project of Boston College
as a Legal Specialist in
                               http://fsp.bc.edu/why-baby-boomers-cant-retire/
Estate Planning, Trust and
Probate Law by the
California State Bar Board     MSN Money
of Legal Specialization. Roy   http://money.msn.com/saving-money-tips/post.aspx?post=a555deea-a470-4bc3-
is a member, former Board      8ebf-09c841
of Governor, and
designated Fellow of the
American Academy of
Estate Planning Attorneys
(AAEPA), a national
membership organization
committed to assisting
attorneys in providing
quality estate planning
services to their clients.
                                         http://www.attorneyoffice.com                                          5

				
DOCUMENT INFO
Description: One of the most poignant demographic trends that we are seeing in the United States today is the rapid aging of the population. This is due to the fact that members of the baby boomer generation are starting to enter their senior years. "Baby boomers" are Americans who were born between 1946 and 1964, and there are approximately 77 million baby boomers in the United States. This is resulting in approximately 10,000 people applying for Social Security every day. This report presents the facts about Social Security and how baby boomers can finance a truly comfortable retirement.