Aging with Freedom is a personal journey in successful retirement by a couple of trailing edge Baby Boomers 958 and 1961. The modern Do-It-Yourself Retirement System requires proactive planning and choices. Aging With Freedom will help you achieve high wealth, high health, high purpose through smart questions and informed choice.
Green Aging is living in harmony with nature. It is being present in nature throughout every season for two or more hours a week. Aging With Freedom coined this phrase to sum up both empirical and practical lessons about the benefits of living plants, flowing water, wild animals and the natural world.
Why is Green Aging Important?
Nature impact our wellbeing. “What you are seeing, hearing, experiencing at any moment is changing not only your mood, but how your nervous, endocrine, and immune systems are working.” – University of Minnesota
Seasonal changes are a perfect time to reflect on our connections with nature. Seasons connect us with the rhythm of the natural world. The first greens of summer arrive. The last colors of fall slip away.
Yet, we too easily focus on the next season – Winter preparations for the upcoming holidays or Spring cleaning before upcoming scheduled Summer trips. Sometimes our personal agenda misses the bigger picture.
Studies on healthy aging tell us to spend time in nature — be present in the outdoors, green plants, blue water, and the weather. Connect with the living world. Being present in nature means celebrating the now! Don’t wait for the next season or next year.
When participants viewed nature scenes, the parts of the brain associated with empathy and love lit up, but when they viewed urban scenes, the parts of the brain associated with fear and anxiety were activated. It appears as though nature inspires feelings that connect us to each other and our environment.
The amount of time spent in nature matters! A recent study concluded that in order to reap the health benefits of nature, the optimal amount of time to spend in green spaces (i.e., urban parks, the woods or beaches) is two hours per week. That’s an average of approximately 17 minutes a day.
Literature, experience, and science all say, time in nature improves well-being
“Therapeutic landscapes and wellbeing in later life: Impacts of blue and green spaces for older adults” is a study published in both Health & Place Journal and Science Daily.
Jessica Finlay with the University of Minnesota led the research team and looked at the influence contact with nature has on our sense of well-being in later life. The researchers concluded a connection with nature is a health resource for older adults and healthy aging. Being in nature promotes feelings of renewal, restoration, and spiritual connectedness. It can also enhance a sense of purpose and reduce loneliness.
Natural environments enable older adults to uphold daily structure in retirement and provide opportunities for diverse activities outside the home. This is important to quality of later life by decreasing boredom, isolation, and loneliness; as well as boosting one’s sense of purpose and accomplishment.
Green spaces create a greater sense of wellbeing. But don’t forget blue spaces. When you add blue spaces with flowing water, like lakes, rivers or even fountains, the positive green effects can be amplified.
“The Blue Health Project, led by a team at the University of Exeter, is investigating the impact of rivers, lakes, oceans, and urban water features such as fountains and canals on physical and psychological health. They’ve found that when individuals attempt to reduce distress they prefer to look at photos of nature — and in particular, photos containing as many water features as possible.
Being in nature also bestows a sense of connectedness, meaning, and purpose. …In a world bogged down by social pressures, standards of conduct, and the demands of others, nature gives people a chance to appreciate a grander sense that the world is alive, fascinating and meaningful. This universal appeal crosses all cultures and time periods.”
The natural world restores our senses of proportion and purpose.
The Little Details in Green Aging
Jessica Finlay urges us to remember this need for green aging in both large scale planning and in individual action-steps focus. She believes, “little details matter”, like trees, benches, curbs, and crosswalks in our community planning. (What helps Minnesota seniors age in place? U researcher has some clues) The best architecture makes connections between the outdoors and indoors, maybe even bringing some of the natural world inside.
Do what makes you happy at the start of your day. Everyday.
Get rid of the “rotten eggs” in your life.
Surround yourself with positive scents and sounds.
2. Get out the door. Often. Regularly. At least two hours a week. Even if it’s just around the block and back. Another good reason to get a dog. They provide a daily ‘excuse’ to bet outdoors!
Daily walks with one of our best buddies, Gunner the Brittney, gets us outdoors and engaging with our community.
3. Prioritize everyday contact with nature. Make it a habit. Whether it’s sitting in a park, climbing a mountain, listening to a water fountain, or looking at potted plants on a windowsill. (Studies have shown that even a simple plant in a room can have a significant impact on stress and anxiety.) The natural world connects us with something larger than self.
So enjoy nature and take time, daily, to be present in nature and the natural world. It is a source of High Health as we age!
Let nature blow the fog out of your soul
Our old friend, sassy Anne Shirley in Anne of Green Gables reminds us of our common experience with the clarifying force of nature. Her experiences are parables for all ages.
It was November–the month of crimson sunsets, parting birds, deep, sad hymns of the sea, passionate wind-songs in the pines. Anne roamed through the pineland alleys in the park and, as she said, let that great sweeping wind blow the fogs out of her soul.
L.M. Montgomery, Anne of Green Gables
Let’s all become a part of green aging by getting out into nature! Celebrate it. Be present. And blow the fog out of your soul!
My house is too big is an uncomfortably common realization. The Wall Street Journal reports an oversupply of high-priced custom estate homes and mansions. An oversupply of the too big house is driving down sales prices in many popular retirement markets. “A Growing Problem in Real Estate: Too Many Too Big Houses — Baby boomers and retirees built large, elaborate dream homes across the Sunbelt—only to find that few people want to buy them“
Sellers forced to downsize mean a fire sales on the too big house
The problem? Aging sellers are facing high maintenance, declining energy, health challenges, and isolation. Literally, their dream house is now too big for them. In other words, the pressure to downsize is real and urgent. The dream becomes a nightmare. My house is too big!
“You had this wave of homes built that now just don’t make sense for a lot of the people who bought them,” said Rick Palacios, Jr. of John Burns Real Estate Consulting.
One of several examples from the article? According to the WSJ, the Hambletons are selling their roughly 4,200-square-foot country creekside estate home on three acres because they want “somewhere smaller where someone’s taking care of everything.” Why? When it comes to aging “I don’t know that you face these things until you have to.”
Don’t count on the McMansion as a retirement asset, it may be a liability
Boomers are planning to age-in-place in their two-story 4,000 square foot suburban McMansion albatrosses. But when they realize my house is too big to maintain? To afford? When boomers ultimately go to sell? Generation X and Millennial wealth and income may not stretch to current prices. And changing tastes and preferences mean they may not want to. The too big house is too much.
Minimalism, authenticity, and sustainability are “in” trends. These are the opposite of the high maintenance McMansion’s faux facade and maximum square footage aesthetic. Then toss in the debt-free movement and mortgages the size of a small country’s national debt are out of style.
We’ve been here before
History doesn’t exactly repeat but it rhymes. The large homes built from 1870 through the early 1900s fell out of favor. First tastes changed. Post-WWI? The smaller Craftsman bungalow was all the rage. Then demographics and the economics of the Great Depression decimated demand. Way too many people realized my house is too big. Many grand homes ended up as subdivided apartments. Or decayed away. Does a similar fate await the McMansions and estate homes of the Baby Boom housing wave?
You can’t eat the house, especially the McMansion
What’s that mean for aging Baby Boomers? Don’t count on your expensive home, especially the too big house, as a retirement asset. Another Aging With Freedom maxim? “You can’t eat the house.” It’s not cash until it’s sold. And real estate can be very illiquid.
Action Steps when you know my house is too big
Some of these lessons we personally learned by living. We owned a McMansion. With a pool. In Arizona. It was beautiful and our dream home. But the utilities were crazy, even for, or especially for, a new house. We had two bedrooms, a dining room and a formal living room we never used.
A couple of our Aging With Freedom high wealth rules are:
Limit your residential real estate to no more than 25% of your total assets to avoid over-weighting.
A median or average home is easier to sell in every market.
We sold our McMansion, locked in the gain, and don’t regret it. We downsized once into a 1,800 sq ft. home. A home purchased at the local market average price.
Our personal current weight of residential real estate remains under 20%.
We’re reminded that Warren Buffett does not live in a mansion. The not so big house is a smart choice.
And we still plan another round of downsizing to an even smaller condo.
The risk of falling prices for the too big house is another argument for planning to downsize now. Downsize before you are forced to do so.
Get ahead of the curve. And be proactive. If you think my house is too big? Then, sell now and downsize. Before everyone is trying to do the same thing. All at once.
Winter 2018 begins in a few weeks. The chill of recent temps has moved our neighborhood into the holiday spirit. A little early. As I unboxed Christmas decorations yesterday I knew the holidays had not ‘snuck-up’ on us, not this year. Unlike previous years, this year was long.
The slow decline of my father and his recent death made 2018 a year of strong memories. Too short and yet too long.
“Our brain encodes new experiences, but not familiar ones, into memory, and our retrospective judgment of time is based on how many new memories we create over a certain period. In other words, the more new memories we build on a weekend getaway, the longer that trip will seem in hindsight.
This phenomenon, which Hammond has dubbed the holiday paradox, seems to present one of the best clues as to why, in retrospect, time seems to pass more quickly the older we get. From childhood to early adulthood, we have many fresh experiences and learn countless new skills. As adults, though, our lives become more routine, and we experience fewer unfamiliar moments.” – The Scientific American
Dad’s last year was a mix of sweet and painful memories. Memories I keep fresh. They are paired with holiday memories of youth, racing Dad to the house on Christmas Eve because he just saw reindeer flying off our rooftop!
This photo of Dad was taken at Christmas 1959. A few years before I came along.
Traditions are great! They bind us together. They got me and my siblings through Dad’s last days and his wake/funnel – still as a family, but forever bruised.
This year, our holiday traditions will change.
We plan to visit Dad’s grave on Black Friday and place a holiday arrangement. I promised Mom. Thanksgiving Day would have been their 62nd year together.
The clock stood still.
Too Slow for those who Wait,
Too Swift for those who Fear,
Too Long for those who Grieve,
Too Short for those who Rejoice;
But for those who Love, Time is not.
Senior housing is stagnant. The typical senior living housing design program features updated materials and colors but is anyone thinking about what we’re trying to accomplish in these constructed environments? We just didn’t see the level of change we expected.
Loneliness is the Enemy. A loneliness antidote is what the industry should be selling.
Aging-in-Place works until it doesn’t. And then it’s too late to win the battle against Loneliness. Just because aging-in-place is cheap doesn’t mean it’s better. The familiar single-family housing is isolating as we age and need social connections and emotional support more, not less.
The Affordability Wall for Baby Boomers is the elephant in the room. Unless you’ve got a public-employee pension, or are on the tip of the wealth pyramid affordability is the barrier to senior community entry for aging Baby Boomers.
Move beyond the senior housing industry’s physical walls to find broader successful retirement lessons. We started our blog focused on just Continuing Care Retirement Communities (CCRCs) but they seemed increasingly irrelevant, with exclusive pricing and serving the wealthy few. We pivoted to looking for lessons for the rest of us for successful aging derived from the best examples of senior communities.
Everything else is changing. Will senior housing and the retirement services industry?
We thought it was time to look again as we approach our four-year blogging anniversary.
Do We Still Care?
We’re passionate about a successful third act, enjoying our retirement. But we see retirement as a new opportunity to engage with the world, not a withdrawal from life. Our personal motto? High Wealth, High Health, High Purpose informs our planning and our living. When we share insights or experience we envision informing our younger selves what we wished we’d known earlier rather than later.
We’ve worked in and around the issues of longevity and senior living. Lori as a developer and design manager. Dan as a regulator and policymaker. Our careers are all about realizing the ideal and expanding possibilities. We always saw senior living communities like the traditional CCRC as an ideal retirement objective.
So does the senior living industry still speak to us as consumers as we approach the realistic option to choose a CCRC or other senior living option?
What trips our trigger today?
What currently excites our passions or stirs our worries? Pain points and passions in entrepreneurial-speak:
Off-grid energy independence and efficiency. We hate escalating energy costs and our power company. With a passion. Top of the list because our “utility” is asking for a 24% rate increase to our base rate from state regulators. This type of uncontrolled expense is anathema to a predictable retirement budget. And we are conservationists. We care about wasting scarce resources.
Financial Independence Retire Early (FIRE) Movement. Dave Ramsey and FIRE are drivers for a large share of the social media communities we follow. Dave Ramsey changed our financial life for the better. We’ve hit the self-sustaining financial independence point and have the choice to retire. Not a lot early, but earlier than being forced out of the workplace. Smart financial stewardship matters.
Travel and Time Together. We watched parents who enjoyed travel get too infirm before taking the time to travel together. We’re emphasizing big and small adventures together, now while we can. See our recent article on How to Plan an Adventure. And since the “we” includes, Gunner the Adventure Dog (a loyal Brittany), RVs and camping seem like a better deal than hotels for family adventures. We’re hitting the road this summer with our minivan and tent camping. But we have an eye on a Winnebago Travato 59K Lithium with solar cells and lithium power or maybe an ultralight RV trailer similarly equipped to defy the need for connected power. This enables snowbird plans.
Autonomous-driving and Electric Vehicles. Our ideal motorhome is self-driving. But we eagerly watch the evolving transportation choices like Uber, Lyft, Waymo, Tesla, and Rivian and see more freedom ahead for retirees. We went through the pain of parents who could no longer drive and should no longer drive. It was an unnecessary point of risk, conflict, and broken spirits. Technology promises a better future in this and more.
Health care cost and access. Okay, this one is more obviously a worry than a passion. Dan’s career is closely entwined with medical technology and the evolving health delivery system. But the view from consumerland for patients is still bleak. We don’t know what anything costs until after it’s bought. Everything and everywhere is expensive. Some places more so. Access and quality vary widely if they exist at all. Especially in rural areas. Rural America, Flyover Country, may be an inexpensive place to live, but it is increasingly being abandoned by government-run healthcare programs that underpay rural healthcare providers. More than half of the 65 million Americans living in rural areas are over the age of 50. Elders in rural areas (about a quarter of all elders) are more likely to reside alone, near or at the poverty level, and suffer from a chronic condition or physical disability. They require an average of 46 miles of travel to get to the nearest health professional. [U.S. Department of Health and Human Services Rural Task Force. (2002). HHS Rural Task Force Report.] Medicaid and Medicare are destroying rural healthcare access. We live in Flyover Country and worry about future care needs, access, and cost.
Do Senior Living Communities speak to these priorities?
Aging With Freedom is all about the freedom to choose our passions in retirement. So, does the Senior Living industry that claims to want to serve us hit any of these pain or passion triggers?
Sadly, not much. Some of these emerging passion options are de facto competitors to the senior living industry offerings by extending the option to age-in-place or to buy senior-friendly services ala carte.
We see hints that some communities are truly emphasizing wellness as more than just a marketing hook. Done well, wellness combats the worries of debilitating illnesses, costly healthcare, and extended dying by offering instead vibrant living.
But where, for instance, are market offerings to facilitate snowbirding? It’s not exactly a new or mysterious retiree behavior. National chains could offer retirees the ability to swing locations to follow the seasons. But the industry is stuck thinking about fixed brick and mortar and not customer solutions.
Are we stuck on repeat? We worry if the senior living industry is relevant to our future.
Lori still loves Captain Kirk’s crew of the Enterprise. “Space: the final frontier. These are the voyages of the starship Enterprise. Its five-year mission: to explore strange new worlds. To seek out new life and new civilizations. To boldly go where no man has gone before!”
Star Trek’s communicators are daily fixtures realized in our ubiquitous smartphones.
George Jetsonesque quadracopter flying cars require little more than scaling up toy camera drones. Amazon and a host of delivery services bring the world to our door. Now with human drivers. But robotic drones and self-driving delivery vehicles are the grand plan. Sooner rather than later.
Amazon’s Alexa and Google Assistant talk to us just like the Enterprise’s computer. No, correct that. Better than. More conversational. With the power of big data, machine learning, and artificial intelligence (AI) the uncanny valley of a contextually appropriate conversational computer indistinguishable from a human voice doesn’t seem impossible to cross. Or far off. Listen to Google Assistant AI make a phone reservation. https://youtu.be/7gh6_U7Nfjs
And AI will transform medical diagnostics and delivery. (Remember one of our worries?)
Science fiction is fiction no more. And we’re excited as heck because we love tech. We’re Boomers after all! Boomers built the Space Shuttle and bought every new consumer electronics device from transistor radios to the Sony Walkman to the Apple iPhone and progeny. Forget that crap that Boomers are somehow technology adverse.
Retirement Living and Senior Housing are not immune to change
So, who believes living in retirement in 2030 will be the same as our grandparents in 1970 or our parents in 2000? Are Senior Living Communities ready for what’s ahead?
Big I vs. Little I
There are two types of innovation.
1. Little Innovation — Little I. Incrementally progressive, sustaining improvement within existing products, services, and markets.
2. Big Innovation — Big I. And the quantum leap of discontinuous, disruptive innovation that resets the table by fundamentally changing what’s possible, creating new products, services, and markets.
We like to think of these as Little I and Big I.
Innovation in Senior Living
Similar to the laundry list of big trends in the overall economy, a few articles caught our eye in recent weeks on innovation in senior living.
Confessions of a Chief Strategy Officer: Senior Housing Industry Lacks Imagination. In this article by Tim Mullane, an anonymous senior housing industry officer bemoans the lack of innovation in senior housing. It struck a chord because we’ve also been struck with just how cookie-cutter similar communities look and feel. And how little has changed beyond color-schemes and finishes. The industry is betting on demographics to save it but is ignoring clear signals that Boomers’ psychographics are different than their parents. The why they buy is different. “Demographics are going to favor senior living in the future, but sometimes I wonder if the industry is being too complacent and that some companies’ “strategy” is just to wait until aging baby boomer come knocking.” https://seniorhousingnews.com/2017/12/18/confessions-chief-strategy-officer-senior-housing-industry-lacks-imagination/
We Moved to the City, Isn’t That Change?
Exact Opposite Now: How Senior Living Design Has Changed Over 20 Years. Another article in Senior Housing News makes the case that the industry has changed. Mary Kate Nelson, points out that the typical sprawling suburban senior living community of 2000 is now more likely to be a smaller, more vertical urban community.
This is just following the crowd in our opinion. Urban development dollars and housing subsidies brought developers downtown. Great. We love New Urbanism in design. But what goes on in the buildings didn’t fundamentally change. This is at best Little I. Not Big I innovation. Incremental, Little I, innovation is better than nothing. We like similar and related trends to mixed-use development and intergenerational housing developments. But we fear it’s ignoring the thunder of the oncoming train of disruptive change and Big I innovation.
I can see the train coming but I can’t get out of the way
Sears Object Lesson. We grew up on Sears as the annual start-of-school outfitting store cum home appliance and tool smorgasbord. Over the weekend, we saw that Sears tried to buy Best Buy twenty years ago. Sears saw the crowds leaving the malls for the big box stores, but Sears wasn’t willing to pay the premium Best Buy’s then growth demanded. The deal fell through. It’s not that Sears didn’t see the train coming. It’s that they didn’t have the courage for discontinuous change. They couldn’t get out of the way of the oncoming trend. And certainly didn’t see Amazon over the horizon. Or Sear’s own potential to leapfrog Best Buy to be the Amazon.
Don’t Bank on [Silver] tsunami. McKnights Long-Term Care News recently examined the financial prospects of the senior housing industry. With leading-edge Baby Boomers entering their seventies, senior service providers are licking their chops in anticipation. But the typical age of a skilled nursing property resident today is about 82. So, nirvana is a ways off for the industry. There are forecasts that say we’ll need three times more senior housing units by 2040 or another 2 million new units. But that’s assuming the past predicts the future. Check your stock prospectus. Past performance does not guaranty future results. Almost every expert interviewed sees the growing numbers of boomers as a boon, but there’s always a but. A hedge. There’s great uncertainty about what Boomers really want and whether the industry is responsive enough to deliver. More fish in the pond is a great opportunity but only if you’re using the right bait. Old bait might not work. And the variety of product offerings is only getting more segmented and confusing for consumers and payers.
We think three other trends may matter more than boomer demographics.
Third-party payers. Medicare and Medicaid, the two big government third-party payers are reducing how much they will pay and how they pay. Brick and mortar is at a disadvantage to more nimble, mobile service providers. Third-party payers matter more not less with the Boomers. As a generational cohort have particularly poor retirement savings, except in the upper wealth echelons. An upcoming study by the National Investment Center for Seniors Housing & Care Industry (NIC) says that middle-income seniors face a funding gap in paying for seniors housing units. The industry has a severe affordability problem ahead. https://www.nreionline.com/print/81663
Labor shortages. Even if the dollars are there, the employees, especially skilled employees, are in short supply. If Boomer demographics favor demand, it hurts supply as Boomers leave the workforce and smaller generations behind can’t fill the traditional service model openings. Can robotics, automation, big data, and AI help? That’s where we’d be betting. For most of us, this probably means more interacting with machines and screens than caregivers. The New York Times sees evidence that there’s already emerging wealth disparity in people contact versus screen time. https://www.nytimes.com/2019/03/23/sunday-review/human-contact-luxury-screens.html
Tastes and Preferences (Psychographics). Boomers really don’t want to move into an old-age home or a nursing home. Despite all the fancy names, euphemisms and different levels of care and offerings, most senior housing start with a huge stigma. Even if it’s unfair. The success of Margaritaville as a senior living brand? The exception proves the rule. It directly attacks the real problem of industry image. If senior housing felt more like returning to our youthful college days? When we loved group living (and socializing) in the dorms or Greek houses? It would sound like Margaritaville. https://www.nytimes.com/interactive/2018/11/14/magazine/tech-design-longevity-margaritaville.html
Alan Jackson & Jimmy Buffett - Margaritaville - YouTube
There are also movers beneath the surface that are promising to help traditional senior housing industry members deal with the potential of technology to change the world. One we like is K4Connect, promising to integrate the power of Big Data and the Internet of Things (IoT) for senior living communities and their residents. It’s well backed by savvy and deep venture capital. And we like their approach of integrating and simplifying tech for the community operator and the community’s residents. And K4Connect rightly rejects that seniors somehow don’t like tech. We’ll love tech when it delivers tangible benefits in our day-to-day lives. We’d buy fairy dust if fairy dust worked. But technology serving the status quo runs the danger of fundamental disruptions to the status quo. We’re still looking for the Big I, the disruptors. http://www.seniorshousingbusiness.com/industry-voices/the-shb-interview-f-scott-moody-ceo-k4connect
What we wrote three years ago is still way too true. Some in
the senior housing industry seem to be waking up to the challenges ahead. There’s
a new world coming whether we like..
Early Retirement – FIRE-proof health insurance?
Why are your friends and family asking, “Are you crazy?”
We declared Financial Independence and Early Retirement (FIRE) and set the date. Our FIRE date is December 31, 2018. Yes. End of this year. It’s a Monday. So, seventy-nine days from now, on a Tuesday, we’ll be off the clock. We’ll own our own time. And in need of FIRE-proof individual health insurance.
Join the Free Call Saturday, 10/27/2018 at 12:00 pm Central Time
Join the video conference Saturday, October 27, 2018, at 12:00 pm Central Time from PC, Mac, Linux, iOS or Android: https://zoom.us/j/821908340
No need to pre-register, but space is limited. First come, first serve.
Don’t Wanna Wait
Why did we pull the trigger? One goal of financial independence is the freedom to avoid work you don’t want to do.
Don’t work because you have to. Work because you want to.
Early retirement should be a function of we can. But often it is a result of no choice or must.
For us, it was because we can. Financial independence comes first in FIRE. But it’s also we have things we want to do together. So why wait?
Time to celebrate. We’re thrilled about the freedom that lies ahead. We’ve got both business and personal projects and travel planned. Our Third Act includes an encore business together. A big, long-delayed DIY project – kitchen cabinets. And travel. There’s a hitch on the SUV for a reason. There’s a dreamed-of RV for in-country. Other places require wings. Hawaii, Sydney, Edinburgh, and more are on the list.
Are You Crazy?
We’re excited to share our plans with friends and family. But we’ve noticed a pattern when we share. We were ready for, “What are you going to do next?” We know that retirement isn’t a destination it’s a journey. But that question wasn’t the first reaction.
Instead, everyone asked, “Are you crazy? What are you going to do for health insurance?”
Okay, the “Are you crazy?” was mostly implied but heavily emphasized. The real issue is health insurance, not our mental state.
Seventy-nine days from now, January 1, 2019, we’ll also be off employer-sponsored health insurance. We’re going to need FIRE-proof individual health insurance or protection against the unexpected health challenge.
Those That Went Before
My older brother is a great example. First thing out of his mouth. Not, “Now you have time to come to visit us out West.” No. It was, “What about health insurance?” His experience is painful and expensive. He’s approaching sixty-five. But to get there? Various members of the family had heart surgery, foot surgery, and a hip replacement. And not all of it was a result of my brother’s motorcycle and bicycle racing affliction – anything with two wheels. Health insurance was and is still a major worry.
And we’re old enough to notice the bell curve of major illnesses and sadly death randomly striking previously hale and healthy friends our own age. Health insurance matters because we don’t know when health challenges will arise. They won’t necessarily politely wait until after age-65.
Those that went into early-retirement before us are saying don’t ignore health insurance and health care. They are a major expense and headache.
Reformed and Deformed
This is not a surprise. We’re joining the troubled and confusing “reformed” individual health insurance market post-Affordable Care Act (ACA or Obamacare).
There are good things about the ACA including the ability to obtain health insurance even with pre-existing medical conditions. But the bad is that access can be very expensive. The first “A” in ACA really means “irony.” Health insurance premiums have gotten much more expensive post-reform.
The confusing part? Your price and my price may be very different because while health status no longer matters, income does, at least within the Marketplace Exchange. That expensive premium? If you make less than four times the Federal poverty level plus the cost of insurance? Taxpayers will pay that expensive premium. (About $65,000 upper limit in most states.) Go over the limit and you are suddenly paying the entire pricey premium. This is the premium cliff. It’s dangerous to drive too close to the edge.
Where you live also matters. Insurance plan choices and prices differ state-to-state and even within states. Some urban areas have multiple choices. Many rural areas are lucky to have a single choice.
We examined options earlier in 2018 before leaping into the unknown. But options, premiums, and rules change every year. So we don’t know exactly what we’re going to do. We do know there are choices with which we can live. (See: Countdown to Freedom and Early Retirement)
And time is short for choosing. ACA open enrollment runs from November 1 – December 15, 2018, for individual health insurance in 2019.
Where Angels Fear to Tread
The choices vary so much by your location and individual circumstances that there’s no one right answer. You must understand the limits and the tradeoffs. The devil is in the details. We still feel the dread of fools rushing in where angels fear to tread.
Share the Journey
Figured you might share our problem, fears, and anxieties. So we thought we’d share our journey. It might help if you too are planning early retirement or are late-career self-employed before age-65 and the magical Medicare-eligibility.
Group Video conference Call – ACA Individual Health Insurance Questions & Answers
Aging With Freedom is inviting you to a scheduled Zoom video conference meeting to discuss the options for health insurance between now and Medicare-eligibility at Age-65. If you’re planning for or in early-retirement or late-career self-employed, this is for you. We’ll share a summary and some examples. You’ll have a chance to ask questions. And share your insights.
Not Selling Insurance – We’re Buyers Too
AND. . . we are not selling anything at this webinar. Just sharing our research as we are buying too.
Join the Free Call Saturday, 10/27/2018 at 12:00 pm Central Time
Join the video conference Saturday, October 27, 2018, at 12:00 pm Central Time from PC, Mac, Linux, iOS or Android: https://zoom.us/j/821908340 No need to pre-register, but space is limited. First come, first serve.
Your Individual Health Insurance Choices
Here are your health insurance options from now until Medicare-eligibility at Age-65 for early-retirees or the self-employed. Aging With Freedom is a blog, community, and advice for a successful Third-Act (retirement) pursuing the trifecta goals of High Wealth, High Health, High Purpose. Again, we are not selling insurance. We’re shopping too. But we’re sharing our research on the new options for 2019 and the pros and cons of the various choices. Maybe we’ll learn even more from you. For 2019 the choices are:
From the Exchange. Individual Insurance with potential cost-sharing and premium subsidies through the Affordable Care Act (ACA or Obamacare) Marketplace Exchange. Income matters.
Outside the Exchange. Individual insurance, unsubsidized, outside of the Marketplace Exchange.
Temporarily Bridge the Gap to Medicaid. Newly extended Temporary Health Insurance policies can now bridge three-years (say between Age-62 early Social Security retirement and Age-65 Medicare-eligibility).
Association Plans. Newly available association plans, especially for the self-employed through sponsors like Farm Bureau and National Federation of Independent Businesses (NFIB).
Extend your current group insurance through a former employer, but at full price with no employer subsidy. COBRA is an acronym for the Consolidated Omnibus Budget Reconciliation Act from which the requirement comes for employers to offer former employees the ability to continue coverage.
Exempt Alternatives. Religiously-affiliated Health-Share accounts, that are not technically insurance, are exempt from ACA minimum policy standards, and therefore more affordable.
We’ll talk more about these and the pros and cons on the call and in a follow-up article. And we’ll let you know what we choose.
Technical Call-in Details
This is a video conference. Easy to join from any web-connected computer, tablet, or smartphone with a web camera and a microphone. Also, there are options to join by telephone below. You don’t have to be on video just because we are.
Add this link to your calendar and join at the appointed time,
Other ways to join. Or iPhone one-tap :
US: +14086380986,,821908340# or +16468769923,,821908340#
Dial(for higher quality, dial a number based on your current location):
US: +1 408 638 0986 or +1 646 876 9923
Meeting ID: 821 908 340
International numbers available: https://zoom.us/u/ad7FkQ7lPV
In the meantime, good luck with planning for or living in early-retirement and the search for affordable health insurance before Medicare. This includes those of us self-employed in our encore venture. We can’t afford to spend our entire income on health care. You can’t either. There are other priorities in life too like food, shelter, and fun. We want Aging With Freedom and to the freedom to choose some fun and happiness.
What is it like to find your life’s purpose and then put it into action?
Living your life’s purpose may not win you a popularity award.
It may not be an easy road.
But for some, like Sister Elizabeth Kenny, living it may leave a legacy worth the fight.
Sister Kenny put ‘a life of purpose’ into action. She pioneering principles of muscle rehabilitation and her work became the foundation of physical therapy. She was an innovator. A lion. She recommended exercise for polio victims when the standard treatment was passive. Sister Kenny persisted. Patients experienced better results. Most experts rejected change. But the Mayo Clinic accepted the results and applied her new best practices. Hence the Minnesota connection and location. Her legacy of courage continues in Minnesota-based Courage Centers.
About Courage Center
The first Courage Center began in 1928. Today, the organization serves the changing needs of children and adults with disabilities. Courage Centers emphasize advocacy and recreation as well as rehabilitation for those with disabilities. The disabled can, should and do participate in society.
You’ve been working on your retirement plans and wondering when to downsize? When your peers move may matter. Are you going to be surrounded by peers or your parents’ contemporaries? So, when are most Baby Boomers moving to Senior Housing? Is it too early to make that move while in your 60’s or early 70’s? Maybe where is the question? Is this generation of retirees even considering Senior Housing communities? The marketing literature and pitches show retirement communities full of youthfully energetic Baby Boomers. Is that a fair depiction of reality? Or do Baby Boomers have something else in mind? Is smaller enough and less maintenance? Or is less expensive the goal?
42% of Boomers Want to Move or Downsize
New data from a survey conducted for TD Ameritrade shows that retirees are likely to change their living situation if they haven’t already. But that doesn’t mean moving to traditional Senior Housing communities. According to the TD Ameritrade survey, 42 percent of Americans plan to downsize in retirement. Why? What are they looking for in a new home?
25 percent plan on moving to a warmer climate;
17 percent plan to move closer to family; and
Just 6 percent plan on moving to a senior living community
So warmer and closer to family for sure. Maybe more economical and less maintenance. Expensive, age-segregated senior communities? Not so much.
Reality: Boomers are not moving into Senior Housing
Reality: Boomers are not moving into Senior Housing
‘Boomers’ are waiting longer than prior generations to consider senior living options. A US News survey confirms the dismally low interest of Baby Boomers in Senior Housing. Only 10% of Baby Boomers say they are even interested in Senior Housing (US News 4/6/2015). That may change with age and health but for now? Boomers are telling the Industry they’re not yet interested. Those youthful Baby Boomers you are seeing in the marketing materials…are a marketer’s wish, not reality.
Wish we’d move sooner
What do retirees wish? If Boomers are not moving (or even considering Senior Housing), will there be future regrets? After all, leading-edge Boomers are now in their 70s and current, younger residents in Senior communities frequently report, “We wish we’d moved sooner.”
At AgingWithFreedom, we agree our parents and their peers often moved too late. Too late to fully (or ever) live the promised active senior lifestyle. Too late to enjoy the shared community activities. And way too late to form new friendships and enjoy the proffered social engagement.
At what age should seniors downsize? Or will Baby Boomers choose to enter Senior Housing at all?
Range of Communities
and Living Options
Full-service senior living communities offer a range of living options. The range spans a mix of needs from housing and social engagement to various levels of help and care. Independent Living is the lowest level where the emphasis is on hospitality and social activities. Assisted Living and Memory Care offer much more help tailored to individual needs. Skilled Nursing provides rehabilitation and long-term care. The level of amenities can range from basic to luxurious. Prices vary. These full-service communities are Continuing Care Retirement Communities (CCRCs). The industry’s new marketing lingo for CCRCs is Life Plan Communities. But there are also stand alone offerings in each category. Contracts vary from rental to pricey buy-ins.
Like most Senior Housing, CCRCs are age-restricted communities. Residents must be over some minimum age. Ages 55, 62, or 65 are the most common legal thresholds. The legal minimum has little to do with actual average entry ages. Ignore all the advertising emphasizing active senior living. Look for yourself. Ask about the average resident age. The real entry age is often older. Much older — by decades not years.
What is the average
age of a senior in a retirement community?
Too many Communities, especially CCRCs, base their marketing plans targeting anyone age-70 and over. Back in the day that may have been a good number. But it no longer reflects the reality. Age is relative. Boomers don’t feel old or ready to move at age 70. Age 81+ is a better estimate!
“High-end communities featuring lifetime care and lots of amenities draw new residents who are, on average, 80 1⁄ 2. Communities that provide a narrower range of independent or assisted living services draw new residents who average 84 years of age.” – Margaret Wylde, President and CEO of ProMatura Group, an Oxford, Miss. research firm that has done extensive work with senior communities.
Age 80+ is the age when care often becomes a question.
Perhaps a health crisis rings the bell. Moving to follow an adult child in a
new, distant city is a thing. You probably know some trailing grandparents.
(Like the trailing spouses of our careers.) Regardless, the average age of
entry into Senior Housing is going up, not down.
This entry age does varies by the community. New communities can attract a younger demographic. But especially for established communities, the mid-80s is often the average age of entry. That means new residents are already more frail than many communities planned. You may want a few neighbors your own age.
3 trends are working against a new entry wave of Boomers.
Three things are working against traditional senior housing
geared to attract 70-year-olds. Occupancy rates are on average falling.
Changing consumer behavior. Yes, there’s a big demographic wave of baby boomers hitting retirement. The front of that wave born right after WWII is turning 70. But they are not behaving like their parents. They often aren’t even retired at 70. Many don’t even plan a hard stop to careers. They expect to retire later and live longer. They have a strong preference to age-in-place.
Greater economic uncertainty. The Great Recession and a shrinking middle class hit the baby boomer generation hard. The boomers have relatively smaller retirement nest eggs than their parents. Stock-market-driven 401Ks are their retirement security blankets. The performance of defined contribution plans is not guaranteed. Earlier generations had more secure, predictable cash flow from defined benefit pensions. Baby boomers are conscious of this volatility and vulnerability in their paper wealth. A volatile stock market and volatile home values mean boomers are twice burned. Boomers are thus more reluctant to lock-up assets or give up cash flow with a hard to reverse commitment.
Rising prices. Consumer inflation may be low. But healthcare is inflating faster than other costs. Healthcare is rising at two to three times the rate of wage growth. And much faster than the catchall Consumer Price Index’s (CPI’s) basket of household goods. CCRCs package real estate, hospitality amenities, and care together in a bundled price. As the cost of healthcare and caregiving goes up, so does the cost of CCRCs. CCRCs have an affordability problem. Seventy-year-olds perceive they can’t afford what these communities are offering. There’s too much uncertainty balancing remaining money and remaining time. They can’t afford it. Moving to a CCRC is out of the question until they’ve exhausted the age-in-place strategy. Age-in-place is both more familiar, less expensive, and more flexible.
So most baby boomers are waiting longer to downsize. Longer
to move into senior housing.
That leaves the industry scrambling after the upper end of the wealth and income scale. That’s a race not every senior community can win. And building for the middle-income, Social Security dependent senior is a challenge.
AgingWithFreedom is surprised how little has changed in this industry over the past thirty years. Yes, the back office management is now digital, but what residents see is remarkably the same. Even the architecture often seems locked in amber. Classically inspired formal decor appealed to the Camelot generation. It’s still out there. But baby boomers like open floor plans, informal decor and independent choices. Senior living communities shouldn’t look so much like funeral parlors if Boomers are to be the new wave.
Too many communities ignore the changes in retired boomers’
behavior, tastes, and preferences.
So what will be the
boomer entry age?
We predict most Boomers won’t move until there is a dire
need to move. Like a major health crisis. This will keep most Boomers out of
senior housing until their 80’s. If true, we will have lost the lessons of our
parents’ generation. Boomers will be moving too late to make the move a
positive, happy transition into a vibrant community.
A senior community’s services should begin while retirees are still living in their “age-in-place” homes. Many Boomers will downsize, but not into a Senior Housing community. Hip urban, mixed-age developments are attracting Boomers. The neighborhood’s feel and amenities matter. The socially required volume of private space might shrink to be more affordable. Think the Tiny House movement as inspiration. Boomers appear to be swinging from McMansions to Minimalism. Boomer consumers might also choose less desperate care in their last phase of life. Or perhaps they consume both healthcare and assistive care in less expensive venues. Something has to give.
When should you make the move?
Baby boomers are not going to buy the exact same thing their parents wanted. When should you make the move into senior housing? Get to know this industry. Spend time researching the right community for you! Determine the real age of the current residents. Marketing can mislead. Unless something changes, most Senior Housing communities are still geared to support ages 84+. But don’t ignore the benefits of moving earlier rather than later if you can afford it! In the meantime, consider downsizing as an intermediate step. Downsizing space can downsize financial worries and maintenance burdens, leaving more time and money to enjoy life.
US News: 7 Baby Boomer Housing Trend to Watch (https://money.usnews.com/money/blogs/on-retirement/2015/04/06/7-baby-boomer-housing-trends-to-watch)
11th Hour 11th Day 11th Month: At the going down of the sun and in the morning, we will remember them. Remembering all who served freedom.
History is full of wars of conquest. Sacrificing for the freedom of others and defending peace is a rarer gift. We’re thankful for our Veterans. Our family descends from an American Army Nurse and a British Army Officer who met in France, a product of the Great War. Another grandfather served in WWII. Our fathers served in WWII and Korean Wars.
The holiday traces its origins back to the end of World War I. On Nov. 11, 1918, an armistice between the U.S.-led Allied nations and Germany went into effect on the 11th hour of the 11th day of the 11thmonth. Though the war wasn’t officially over until the Treaty of Versailles was signed seven months later, the Nov. 11 is recognized as the end of the “war to end all wars,” according to the Veterans Administration.
In November 1919, President Woodrow Wilson proclaimed Nov. 11 as the first commemoration of what was then known as Armistice Day, saying “To us in America, the reflections of Armistice Day will be filled with solemn pride in the heroism of those who died in the country’s service and with gratitude for the victory, both because of the thing from which it has freed us and because of the opportunity it has given America to show her sympathy with peace and justice in the councils of the nations…” — Veterans Day 2017: Why is Veterans Day on Nov. 11? Holiday history, military facts and more