Guess Who’s Living With This 95 Year-Old Woman?

Plus, with $4.5 million in savings, do you need long-term care insurance? 

It's Monday, August 19th, I want to share with you a story of two women.  This is a very common scenario, so I guess you might say it's not much of a story, story of a mother and daughter.  Mom's getting a little older, so she’s living with her daughter. Yeah, you know, the daughter was a little concerned that mom was living alone and in her elder years and didn't think that was such a great idea, so had mom move in with her.  

Not a real shocking situation, right? Except for one little twist.  Dorothy Williams, the daughter, she's 95 years old.  Her mom, Elizabeth Francis, is 115. Yes, Elizabeth is the oldest living American. By the way, when she was asked for advice on how to live a long, fulfilling life, she said, speak your mind and don't hold your tongue. 

Well, I guess I'm gonna live a long time because that epitomizes me, doesn't it? So yeah, they both live together in Dorothy's home. They both have caregivers. So that is a bit of the changing face of our demographics, isn't it? Not only are you living a really long time, but so are your parents. 

And that's presenting an entirely new dynamic that we as a society are not really used to dealing with. Meanwhile, while Dorothy and her mom, Elizabeth, are enjoying themselves in their old age, the newest employee benefit that companies are now beginning to offer is to pay for the costs for female employees to freeze their eggs. 20% of the Fortune 500 now offer this employee benefit. In 2022, the last year we've got statistics, 30,000 women across the country engaged in this activity and froze their eggs. Women say that it lets them focus on their career in their 30s. They don't have to worry about that biological clock ticking in their 20s and 30s saying, gee, if I don't get pregnant soon, I'll never be able to.  

Now they're able to say, I don't have to sacrifice my career. I can focus on it. By freezing my eggs, I can produce a child in my 40s or 50s. Women also say they don't have to worry about being infertile in the future and having to rely on IVF treatments, in vitro fertilization, they will have their own eggs to become pregnant. And with the boss willing to pay for it, why not take advantage of this? After all, the cost of freezing your eggs? $50,000.   

Meanwhile, nearly half of those who are under the age of 50, say they will never have children. 64% of women say they simply don't want to have children. Fifty percent of men say this. Both the men and the women say they'd rather focus on their careers or their interests. They worry about raising a child in this difficult world. They worry about the costs of raising a child. The Department of Agriculture now says it costs more than a quarter of a million dollars to raise a child from birth to age 17. 

And then we know what happens at age 17. You're dealing with college costs after that. They worry about the environment, including climate change. They say they haven't simply found the right partner. Only 13% of those who say they're never going to have children blame infertility for this. And only 11%  say it's because they have a spouse or partner who doesn't want kids.  

Well, look on the one hand, Dorothy and Elizabeth, living to a nice ripe old age, and lots of others like them following along. So, we have an aging population. We now have more people older than we've ever had. And simultaneously we have younger people not wanting to have children or delaying the children that they're going to have or reducing the number of children they're ultimately going to have. 

The bottom line, the U. S. fertility rate. is now 1.6. It takes 2. 1 children per woman to sustain the population level, and we are now below that, which means the demographic pyramid we've always used to have, you know, picture that pyramid at the top of the pyramid are very old people, the very bottom of the period are babies. We always had lots of babies, the bottom of that big wide base in the pyramid. And as you age, you tend to die, and the older you get, the more likely you are to die, to the point where you're at age 100, there aren't very many of them. So, we have lots of babies at the bottom, very few 100-year-olds at the top. 

And so you have a demographic pyramid. Well, that pyramid is now becoming a box where we have virtually as many old people as we have young people.  This is creating a very different demographic. And as a result, a very different set of social needs where we, you know, have more need for nursing homes than elementary schools, for example.  

This is not, by the way, just a U. S. issue, It's a global issue. In South Korea, women aren't just saying no to babies, they're saying no to marriage. 42% percent of all households in South Korea have just one person in them, and 81% of South Koreans support unmarried cohabitation. In other words, if you're not going to have a spouse or partner, isn’t that a prerequisite for having a baby? 

Uh, generally, yes. Although thanks to science, not necessarily any longer. It demonstrates how things are changing and how our society has to change with it. And that means our public policies and our federal and state laws and regulations. All of those have to adjust for what's going on. What better time to be talking about all of this then with the Presidential and Congressional elections that are occurring in November. We need to be engaging with our candidates to ask them, are they aware of these demographic shifts in society? What is their viewpoint on all of this? What do they think the social policies and rules and regulations ought to be?  

This is the time for us all to be asking these questions, not only of ourselves, but of those we are thinking of voting for.   

One of the questions that I got from a listener to the podcast...Mary of Maryland wrote in to me. Here's her question:  

My husband is 73. I am 69. We have a $500,000 home that's paid for and $4 million in savings. We don't have long term care insurance. How much should we set aside for that? Is a million enough?  

Mary, congratulations, you and your husband have done a fabulous job accumulating wealth. You've achieved the American dream. Four and a half million-dollars net worth... it's really exciting to see. I don't think you need to set aside any money for long term care insurance for the simple reason that you've amassed plenty of money. 

I find it hard to believe you're going to spend all of it, finding yourself wishing you hadn't and because you need long term care suddenly. Instead recognize that if you did want to set money aside, well today, you know, long term care can cost, $10,000 a month, $15,000 if 24/7 care is required, say for an Alzheimer's patient.  The typical individual needing long term care needs it for three to five years. So if you spend $15,000 a month for five years, that's $900,000 you'd spend. If both of you had to do that, that would be $1.8 million. You've got $4.5 million. So, I don't think you need to set money aside. You perhaps can do it through mental accounting. Just in the back of your mind, you're saying to yourself, we want to not spend all of our money or give all of our money away because we might need it for our long-term care in our future. But I would leave it at that. I don't think you need to be terribly worried about it. I think you're fine financially. You're easily going to be able to handle your long-term care costs. 

And I don't want this to cause you to not enjoy your lives. My fear on the numbers I've given you is that it's going to cause you to sit home and not travel to Europe. Or if you do travel, you're going to fly coach instead of first class. Or you're going to quit giving the grandkids Christmas presents because you don't think you can afford it. Please, everything is great. You're in good shape financially speaking, you don't have to worry about this. I wish you the best. I wish I could say that for so many other folks who aren't as fortunate and hadn't worked as hard or been as diligent with their savings as you and having amassed the money you've amassed.  

For those folks, I implore you, if you're younger, go buy long term care insurance.  Much better to spend the $10 grand a year on long term care insurance than the $10 grand a month that the cost of care would require.   

You can send me your question as well, just send it to askric@thetayf.com. The link is in the show notes. 

I'm glad you're with me here on The Truth About Your Future.  If you like what you're hearing, be sure to follow and subscribe to the show, wherever you get your podcasts, Apple, Spotify, YouTube, and remember leave a review on Apple podcasts. I read them all. Never miss an episode of the truth about your future. Follow and subscribe on your favorite podcast app. 

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