Truth or fiction?
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The golden years. Freedom 65. The joys of retirement. These widely used and familiar statements paint a relatively positive picture of the retirement stage in general. They also represent a natural tendency among many of us in what we hope for and envision when thinking ahead to senior life, whether that includes more time to travel, spending quality time with family or enjoying new hobbies. And while looking forward to and identifying your goals for this life stage is very important, it also needs to be appropriately balanced with planning for the “what-ifs,” especially given the senior health and healthcare realities that are coming to the forefront across Canada. As the senior demographic continues to grow, with Statistics Canada indicating that seniors (those age 65 and over) will account for 20 percent of the population by 2024, and approximately one-quarter by 2036,6 so too will age-related health and senior care challenges, with significant impacts at both societal and individual levels.
Yet despite the fact that more health data on aging is continually emerging and realities about the growing costs of healthcare and senior care are becoming more evident, individual planning in this regard still seems to be lagging, suggesting many just aren’t making that critical connection. For some, considering the “what-ifs” of aging can generate a real sense of discomfort (and understandably so), and this lack of comfort unfortunately often then becomes a serious roadblock to planning. But while it may seem easier to avoid difficult topics, overlooking future potential health concerns as part of your planning only increases your personal, financial and family risks in the long run.
Understanding senior health realities
In discussions about senior health, one of the first statistics often focused on is the trend of longer life expectancies among Canadians (currently age 79 for males and age 83 for females, with the national average sitting at approximately 82 — which is up from age 77 in 2002, for example).7 And while the likelihood of greater longevity itself is very relevant, it’s also important for individuals to dissect what that may mean when applied to their personal situation and the impact it may have on their plans and goals. In other words, beyond planning overall for a longer lifespan, what challenges or changes might take place during those years that need to be accounted for in planning? “One of the first things individuals need to consider is not just the fact that they may live longer, but that they may not live a healthy life for longer,” notes Leanne Kaufman, Head of RBC Estate & Trust Services. “When it comes to those later years, there seems to be a substantial gap between living and living healthy, and the costs associated with that. So beyond age from a numbers standpoint, it becomes about building a better awareness as to what those years may entail from a health perspective,” Kaufman explains.
In looking at cognitive health realities, for example, dementia is currently the most significant cause of disability among Canadians older than 65, affecting 20 percent of adults by age 80 and more than 40 percent by age 90.8 When it comes to physical health, research shows some 88 percent of older adults aren’t active enough, and four out of five adults over 65 have at least one chronic condition.9 Now, while statistics such as these may seem discouraging, the important thing to remember is that many risk factors of age-related health issues are modifiable and there are steps you can take to combat many health conditions. With this in mind, many individuals — of all ages — stand to benefit from first thinking about aging more holistically and then adopting a twofold approach to longevity: doing everything possible to make health and wellness a priority in life, and at the same time pairing that with appropriate plans as a means to account for any potential health eventualities.
For more information about cognitive and physical well-being and how to maintain a healthy lifestyle regardless of age, please view the Spring 2017 Perspectives article, “Promoting brain health at every age,” and the Fall 2016 Perspectives article, “The choice to be active and stay healthy.”
Making choices and tackling difficult topics
When it comes to care, a good starting point is developing a thorough understanding of what options are out there — from retirement communities to assisted living or home care to long-term care — what the associated costs are, and exactly what type of care and lifestyle you get within each of those options. As Kaufman notes, “A lot of individuals lack a true understanding of what those costs are, especially if they haven’t been through it with an older relative or loved one.” What’s crucial to recognize, however, is that there are key benefits in taking proactive steps to determine what you want as it relates to care and what the costs may be. Doing so will help define what amounts you may need in retirement and later life, which thus may impact the decisions you’re making in the shorter term with regards to transferring your wealth, by way of gifts or through inheritance, for example.
For every individual, there will undoubtedly be a different comfort level with discussions around wishes and intentions as they relate to aging or a situation of incapacity, but Kaufman offers a consistent message in this regard: “The awareness piece is so critical. When a family member or close friend is thrust into a decision without knowing what that person wanted, it can bring tremendous pressure and unease for that decision maker, especially if it’s a care decision.” Tabling those discussions early on offers significant benefits, both from an emotional and a practical standpoint, and can then bring greater peace of mind as you put more formal plans into place.
One of the best methods individuals can use to protect their well-being and their finances is a Power of Attorney (known as a Mandate in Quebec), both for property and for personal care. Yet despite the striking statistics on both cognitive and physical decline that often occurs with aging, most Canadians do not have a valid Power of Attorney in place, with one report noting over 70 percent of Canadians do not.10 As Kaufman explains, this may largely be due to the fact that individuals simply don’t understand the risks in the event they become incapacitated. “Without a valid Power of Attorney, you have no control over who acts for you and what they do. Without this document, the reality is that, unless they go to court, no one has the legal authority to access or deal with your financial affairs,” she explains.
“From a practical perspective, it’s also very important to ensure the individual you ask to act on your behalf in a Power of Attorney knows exactly what that role entails and is willing to do it,” explains Kaufman. “They need to be educated on what’s involved, so they won’t feel obligated or refuse to act if and when the time comes, which could present challenges and potential conflict if you haven’t named an alternate.”
From there, it becomes crucial to communicate these decisions to family members and other involved individuals, so your wishes and intentions are clear. “And at the end of the day,” Kaufman reminds, “it’s not a ‘one and done’ conversation, as needs and perspectives may change over time. So even once you’ve made these decisions, it’s important to keep the dialogue going.”
This issue of Perspectives includes an accompanying article, “The power of choice,” that provides a detailed discussion of Power of Attorney and information regarding choosing and acting as an attorney.
Impacts on the Sandwich Generation
When it comes to age-related health challenges, while the focus often remains on older adults themselves, there’s another key demographic where the impacts are strongly felt, and that’s the Sandwich Generation (those caring for an aging parent or elder while at the same time providing care for children still living in the home). Currently in Canada, it’s estimated that approximately 5.5 million provide care to a senior family member or friend, with 60 percent of those individuals juggling paid work and caregiving, and 25 percent spending over $2,000 annually in out-of-pocket expenses for the care recipient.11 The pressures and burdens, both emotional and financial, on this generation are significant, and serve to highlight the range of negative impacts that can occur when appropriate plans or care decisions haven’t been made or communicated in advance, or funds haven’t been allocated for potential care costs in later life.
For many in this generation who are bearing the load of acting as attorney for their aging parent or who are providing care of some description, the entire situation can seem overwhelming and incredibly time-consuming. At the same time, however, as Kaufman notes, “This is when it can also become a real awareness for people. When it comes to life experiences, you simply don’t know what you don’t know, so for individuals going through this process with their parents or elderly loved ones, it can also generate a much better understanding of care options, challenges in the care system, the costs, and the direct outcomes if those decisions and care fall to family members.”
In a roundabout way, then, while tremendously difficult to experience with a loved one, these situations open the window into what this stage of life can bring, providing the opportunity for other individuals within the family to reflect and then apply that knowledge and awareness in their own planning. In shifting the perspective in this regard, and choosing to be proactive in preparing, individuals can gain the benefits of assuring their financial and personal well-being will be better protected and that their wishes and intentions will be upheld, no matter what later life eventually brings.
What is elder abuse?
According to the World Health Organization (WHO), elder abuse is defined as a single or repeated act, or lack of appropriate action, occurring in any relationship where there is an expectation of trust that causes harm or distress to an older person. This can include psychological, physical, financial, sexual or systemic abuse, as well as violation of rights and freedoms and neglect. Some of the factors that contribute to older adults being more vulnerable to the various forms of abuse include cognitive impairment, physical conditions and dependency on others for care, inability to express wishes, lack of choice, isolation and economic vulnerability.
Please visit the Canadian network for the prevention of elder abuse (CNPEA) website to access resources, tools and additional information related to elder abuse.
Growing trends of elder abuse
Elder abuse in all of its forms is largely still a topic that many misunderstand or lack a thorough awareness of, but the reality is that reported instances of elder abuse are on the rise, globally and nationally. Specifically in Canada, rates unfortunately seem to be increasing as the senior demographic expands (reported cases have almost doubled in the past 10 years), but it’s also estimated that only one in five cases are actually reported, so the issue is likely much broader — and silent — than most realize.12
It was 2002 when the WHO first noted there was accumulating evidence to indicate that elder abuse was a significant public health and societal problem but that it continued to be mostly ignored and underestimated across the world.13 Since that time, there has been a gradual emergence of initiatives and organizations that focus on the prevention of elder abuse and on building awareness, a central one of which is the International Network for the Prevention of Elder Abuse. It was this network, in conjunction with the WHO, that launched the World Elder Abuse Awareness Day (WEAAD) on June 15, 2006, as part of the United Nations International Plan of Action to acknowledge the significance of elder abuse.
Since the inception of WEAAD, countries and communities globally have helped to elevate this issue by sharing information and promoting resources and services that boost the safety and well-being of seniors. Recognized on June 15 each year, there are a range of activities, workshops and events that take place as part of WEAAD that aim to mobilize communities and raise awareness, and in Canada, these are planned through a variety of provincial and territorial organizations such as Elder Abuse Ontario and the BC Association of Community Response Networks. And on the national level, the Canadian Network for the Prevention of Elder Abuse (CNPEA) functions as a knowledge-sharing hub to connect people and organizations, increase awareness and foster the exchange of reliable information to help prevent the abuse of older adults.
For a complete list of provincial and territorial elder abuse networks and to find information for how to get involved in your community, please visit the CNPEA website.
For more information on World Elder Abuse Awareness Day, please visit the CNPEA website.
Financial abuse among seniors
According to Health Canada, of all forms of elder abuse, financial abuse tends to be the most prevalent form, with over 60 percent of reported cases being financial in nature.14 And while many feel that this form of abuse could never happen to them, or the source would be from someone they don’t know — via a phone scam or internet victimization, for example — the unfortunate reality is that many cases are actually family members, caregivers or friends taking advantage of a senior’s finances. “It’s part of human nature to entrust those closest to us and assume they will always keep our best interests in mind,” notes Kaufman, “but any number of factors can impact an individual’s judgment in making decisions, including caregiver stress, family conflict or complex family dynamics, financial pressures related to care or caregiving or lack of financial skills, not to mention the emotional turmoil that age-related health conditions or situations of incapacity can often bring within a family.”
As Kaufman stresses, “It can be difficult to challenge that natural framework of thinking, and that’s why it’s so important to really understand how crucial it is to put plans in place as early as possible and to give very careful thought as to who you want to act on your behalf, if you become unable to make those decisions on your own.”
For more insights on financial elder abuse, please view the RBC Wealth Management article, “How to recognize – and prevent – financial elder abuse.”
- https://www.statcan.gc.ca/pub/89-645-x/2010001/life-expectancy-esperance-vie-eng.htm http://www5.statcan.gc.ca/cansim/a26?lang=eng&id=1020122&p2=46