Most seniors, their families and their financial advisors need answers to critical senior living questions. That’s because a number of deal-killing misconceptions continue. The Frequently Asked Questions (FAQs) concept is a very effective and credible marketing communication strategy. Consider creating a market positioning theme that addresses “You’ve got questions . . . We’ve got answers.” Rather than rambling text or boilerplate, this approach focuses very directly on specific important issues. Here are 10 FAQ examples:
- With my Medicare and Medicaid entitlements, aren’t almost all of my future healthcare costs covered? Obviously an erroneous assumption. A senior consumer or their family’s future private pay exposure can be significant.
- Private healthcare insurance is getting very expensive. Do I really need it? Efficiently operated assisted living or possibly a comprehensive CCRC with life care options is frequently the correct answer.
- Can’t most of my future healthcare needs be provided in an affordable manner at home? This may be initially true, but the aging process frequently results in higher acuities. The skills of a typical companion or homemaker are rapidly exceeded.
- It appears that living in a retirement community is much more expensive than staying right here at home. Am I correct? Not necessarily true. A surprising majority of seniors have significant misconceptions regarding their true annual cost of living versus the pricing of well run, market-responsive retirement communities.
- Is there a way to control my future healthcare costs so I don’t spend-down my life’s savings? If a prospect is initially income-qualified for a well-run community, their likelihood of experiencing significant spend-down is relatively remote. Many operators also have a menu of options to avert future spend-down such as unit downsizing, reducing the future entry fee refund obligation for a CCRC and possibly charitable content funding for a not-for-profit.
- Some entry fee communities charge quite a bit. Won’t I seriously reduce my current net worth if I decide to move to one of them? Frequently this is a classic example of short-run thinking. Most seniors do not pay entry fees with their current actual net worth. Most sell a home and pay their entry fee from new cash from their home sale. Very frequently a senior’s current active net worth (before the home sale) is not significantly impacted.
- If I pay a big entry fee, how will I be able to leave a legacy to my children and grandchildren? Upon death, a senior may have a refundable entry fee of up to 90% of his or her original payment. This can provide a living financial legacy to their children or grandchildren. The initial entry fee payment might also provide substantial life care benefits in the form of significant cost reductions to cover their future healthcare financial exposure. There can also be a substantial tax benefit to the consumer of a one-time medical tax deduction of 30% to 35%.
- Are there any special income tax deductions available for some healthcare costs? For a moderate $300,000 entry fee that involves life care, that one-time deduction would be in the range of $90,000 to $105,000 with tax loss carry back and carry forward financial options.
- If I live in an assisted living community, are there any tax benefits? Yes. If you are receiving assistance with at least two Activities of Daily Living or require substantial supervision because of cognitive impairment, you can potentially deduct almost all of the full monthly service fee; shelter, services and care. IRS Publication 502 (www.irs.gov) provides the details.
- Will my children or my financial advisor understand all these FAQ details? Probably not. Most of the answers to the FAQs seem like basic common sense that the senior consumers, their adult children or financial advisors already know. Not true. Many either have not considered them or have not put them in proper perspective.
