The song Rich Girl, written by Daryl Hall and John Oates, was released in 1977 and worked its way up the Billboard charts to number 1. The story line is about relying on OPM – Other People’s Money – and not caring about your actions because of the money. For me, this has a dual meaning; you can rely on inheriting someone’s money or you may find yourself responsible for managing someone’s money.
Why not rely on an inheritance? Simply because there may be no money left. As well, if you rely on OPM and don’t make your own efforts for a secure financial future how can you or your executor(s) address financial needs? Providing and ensuring funds are available for housing and medical needs can quickly deplete a bank account. A financial burden isn’t limited to the elderly. It can just as easily occur in your thirties, forties, or fifties.
It is said that you can’t tell the future. This may be true for some things, but you can get a peek when looking into medical care. Alzheimer’s disease is the leading cause of dementia with a life expectancy of eight to 10 years. It is likely the patient will need in-home care, then assisted living, then a nursing home, and eventually moving to a facility designed for this kind of patient. Think about what it will cost when you get there.
If you live in Alaska you’re in a world of hurt because the monthly average of semi-private nursing home care is $23,433 per month. Check the information provided at Senior Living – I hope you’re sitting down. The average stay is two to three years. Two years in Alaska in today’s money will cost you $562 thousand. If you have that kind of money I’m open to talk adoption.
Unlike some people, my sister and I never expected an inheritance from my parents or felt like “they owed us”. Knowing we would be executors of their estate our conversations were always about what they wanted when the time came they could no longer manage their affairs. Dad’s comment was, “Don’t worry about it, we’ll take care of you. Everything you’ll need to know is in the safe and the safety deposit box.” Um, yeah, not really.
Considering potential future healthcare costs scares the crap out of me (the thought of the government taking care of me is scarier). However, by not relying on OPM and having the self-satisfaction of knowing I can achieve some success at securing my financial future on my own relieves some of the pressure. Foregoing a few perks today is well worth being better prepared for the future as I see it.
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