Talking with clients about what they want to do in retirement – travelling, starting a business, exploring new interests – is exciting. Talking with them about the need to plan for increasing health-care needs can be tough. No one likes to think about getting sick or becoming less mobile but, as we age, it’s a fact of life – and can pack a big financial punch. Take long-term care, for example. Depending on the type of accommodation and amount of government funding available within a province, Canadians could pay from $900 to over $3,000 a month to stay in a long-term care facility.1

Aging and declining health can be difficult to address but, when you do, you help clients prepare both emotionally and financially. By discussing changing health-care needs, the associated costs and income-protection solutions you encourage greater awareness and appropriate actions – helping your clients retire with confidence.

Five stages of care

‘The 5 stages of care’ developed by Dr. Mark Frankel and his team at Taking Care Inc. can help you start the discussion. By categorizing health-related needs throughout retirement into specific phases, ‘The 5 stages of care’ simplifies an often-complex topic, underlining the importance of a solid plan.

  • Stage 1: Independence – Entering into retirement, self-sufficient and able to manage any health problems without special care from a family member.
  • Stage 2: Interdependence – Starting to need help from family members with routine tasks such as cooking, home maintenance, shopping and banking because they become physically or mentally difficult to do.
  • Stage 3: Supportive living – Needing more help with routine tasks and some help with personal care like bathing and dressing. Support is usually in-home and comes from both family and possibly some formal-care services or personal support workers.
  • Stage 4: Crisis management – Becoming dependent on others for extensive health and personal care needs. Care needs are difficult for the family to manage and they turn to care professionals and formal care management for support.
  • Stage 5: Dependence – Needing 24-hour medical support and care. Extensive care needs can no longer be managed by most families and the responsibility for caregiving is transferred to full-time caregivers in a long-term care facility.

With each stage, expenses go up. And while the government may foot some of the bill, by the time clients reach stage 5, their monthly out-of-pocket health-care expenses could be thousands of dollars.

The solutions

Ultimately, it’s about protection. Your clients’ retirement could last 30 years or more.2 They’ll need a long-lasting income – one that allows them to live their retirement, their way, and cover their costs. Understanding how their health-care needs and expenses may change over time is essential. Health insurance solutions offer income protection.

Case study

‘The 5 stages of care: a journey through retirement’ is a brochure from Sun Life Financial about changing health-care needs in retirement and the associated costs. A comprehensive case study featuring ‘Paul and Lily’ clearly demonstrates what a couple living in Ontario may experience in retirement, including actual costs related to prescriptions, home care, physiotherapy, long-term accommodation in a retirement home and more. Share it with clients in your retirement planning discussions and encourage them to proactively address their health-care needs.

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1 Costs were compiled by Taking Care Inc., effective October 2011.

2 At age 65, more than one in six women will live to age 95; more than one in 12 men will live to age 95; three out of 100 men and women will live to age 100. Source: Statistics Canada, Life Tables, 2012.