End-of-Life Planning Outstrips Retirement Care Planning Among Baby Boomers

Two-thirds of middle-income Boomers know someone who has required retirement caregiving, either in their home or in a nursing home, yet few Boomers are taking action to plan for this likelihood.

A new white paper published by the Bankers Life Center for a Secure Retirement, “A Growing Urgency: Retirement Care Realities for Middle-Income Boomers,” makes the startling case that today’s Baby Boomers “are more financially prepared for death than life.”

The white paper is based on a survey conducted by in October 2018 by the Blackstone Group. The Internet-based survey consisted of a representative nationwide sample of 1,500 middle-income Baby Boomers—defined as those with an annual household income between $30,000 and $100,000 and having less than $1 million in investable assets. In 2018, Baby Boomers were 54 to 72 years old.

According to the survey analysis, for more than half (56%) of middle-income Boomers, the primary retirement concern is staying healthy enough to enjoy life after work. The white paper notes that this is a sensible goal, but it belies the challenging financial picture middle-income Boomers face in retirement. Notably, half (50%) of middle-income Boomers have less than $5,000 in savings set aside for a financial emergency. At the same time, nearly four in five (79%) middle-income Boomers have no money set aside specifically for their retirement health care or long-term care needs.

The white paper suggests Baby Boomers are worried about these facts and are hungry for education, advice and solutions that can ease the burden of preparing for long-term care and retirement health care expenses. Among those middle-income Boomers without a retirement care plan, one-third (32%) say they need advice, but do not know who to trust.

“Two-thirds (67%) of middle-income Boomers know someone who has required retirement care, either in their home or in a nursing home,” the white paper warns. “And about half (45%) of middle-income Boomers currently have experience as a caregiver.”

Among Boomers who have caregiving experience, the survey shows they typically have cared for an immediate family member. Of middle-income Boomers who are currently a caregiver or have been one in the past, about two-thirds (68%) cared for their mother or father. One in five (17%) cared for a mother- or father-in-law, according to the white paper, and another one in five (17%) cared for a spouse or partner.

More prepared for death than life?

While only about three in 10 middle-income Baby Boomers have mapped out plans for how they will access and pay for caregiving during retirement, eight in 10 have made at least one formal preparation for when they die. This is why the paper argues Boomers are “more financially prepared for death than life.”

The white paper argues this problem will persist for some time, as fewer than one in five (18%) middle-income Boomers said that retirement care planning is a high or very high priority. Twice as many (40%) said it is a low priority or not a priority.

“Although Medicare does not cover ongoing long-term care needs, more than half of middle-income Boomers mistakenly expect to use Medicare to pay for care should they need it,” the paper warns. “Many middle-income Boomers are unaware of the fundamental facts about Medicare and paying for retirement care. One in six (16%) do not know or are unsure how they would pay for retirement care. Somewhat encouragingly, two in five (40%) middle-income Boomers now expect to use personal savings to pay for care—an increase of 15 points over 2013.”

According to the survey, about one in 10 (12%) middle-income Boomers have purchased long-term care insurance, while more than one third (37%) say they are unfamiliar with the product. Among middle-income Boomers without such insurance, more than half (56%) said they felt it was too expensive.

Among middle-income Boomers who have a formal retirement care plan in place, they are primarily motivated by personal responsibility (31%) and to minimize future burdens on loved ones (31%).