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What Is Your Plan B?

By Gail Glockhoff-Long
GolderCare Solutions
Benefits Advocate

Most older individuals and their families have a Plan A. What happens when Plan A does not work out as you had hoped? How fast can you pivot to a Plan B if Plan A no longer works?

Ellen bought into a Continuing Care Retirement Community (CCRC) living independently in a villa. Her plan is to move to higher levels of care within that CCRC as needed. She has legal documents in place so her son can assist when she can no longer handle her finances. This is a well thought out plan but it could still be derailed. If Ellen developed problematic behaviors that could not be handled within that CCRC, she may have to move elsewhere. How fast could Ellen’s son pivot to a new plan paying for care somewhere else if needed?

After Alvin was widowed, he sold his house and moved into assisted living. He had legal documents in place so his son could help when needed. He was a meticulous person and reviewed his finances regularly. He thought he would live another 10 years and calculated he had enough money to pay for the assisted living for that long with money left over. He wanted to see his family enjoy his money so he started giving things away. He gifted the “extra money” to his children in big chunks. Plan A made no provisions for his needing a nursing home for the year before he died. His Plan A gifting would cause a disqualification for many months if he applied for Medicaid. He did not leave enough cushion in his savings to pay for nursing home for more than a couple months. His children have already spent the money he gifted and were not able to undo the gifts. He had no Plan B. How long will it take Alvin’s children to figure out how to pay for his care if he does not qualify for Medicaid?

Rick’s Plan A was to care for his wife Barb at home for the rest of her life. Barb had advanced Alzheimer’s and Rick felt it was his duty to look after her. It was hard, but Rick was following Plan A – until he did not feel well, went to the hospital, and died of a massive heart attack. Plan A did not include any thought of Rick passing first. What happens to Barb home alone with no caregiver? Who has the authority to arrange care for Barb? How is that care paid? Guardianships take months. How do you care for Barb in the meantime?

Mary was a “collector” – 30 jumbo packages of tissue, clothing she had never worn, an entire drawer of twist-ties, 200 empty jars because you might need one – but no Plan. Her plan was to stay healthy and in control until the moment she died. No legal document planning and no financial planning. She lived day to day. Mary had a stroke and was unable to communicate. There is no close family to jump in.

What Is the Plan?

Nancy is an 80 year old widow living independently. An insurance agent talked her into putting all of her assets into an immediate annuity designed to pay a monthly income to cover living expenses. Nancy thought that would simplify her life. That was Plan A. Nancy broke her hip and needed to move to nursing care 2 years later. She wanted to preserve some of her life savings for her children. Unfortunately, the insurance agent Plan A foreclosed any options for a Plan B. All of her assets had been converted to a stream of income that could not be changed, so it all had to be paid to the nursing home.

Having Plan A is a starting point. Part of the planning also needs to include a Plan B and how to pivot to the new plan. Most of the people that come into our office had a Plan A for aging. In the case of Rick and Mary, being able to quickly pivot to a Plan B became a health and safety concern. How will the person in need of care be cared for during the time it takes to develop and institute a new plan? For Ellen, Alvin and Nancy, the delay could become a health and safety concern if placement is delayed due to the inability to pivot quickly to Plan B.

We have a sign in our office – If Plan A fails, remember there are 25 more letters. Is your plan designed well enough to quickly pivot to the next letter?

Gail is a Benefits Advocate with GolderCare Solutions, helping families navigate the complexities of aging, care, insurance, placement, and public benefits.