My 96-year-old father and I flew in a private air ambulance across the country recently from Sarasota, Fla., to Buchanan Field in Concord. The move was prompted by my desire to have him in a nursing home close to me instead of back in Florida. I'm the only relative he has at this point and one of his few remaining friends. He's outlived everyone else.

The move is also consistent with his comment a year ago when my late mother suggested that they might have to live in a nursing home someday. Dad said, "I'm not going to a nursing home." "Where do you think you're going?" she asked. His quick comeback was, "I'm going to go to California to live with Steve." So, here he is.

Taking care of my parents has been a real eye-opener in terms of how the progression of independent living, assisted living, and finally, skilled nursing facility (SNF) all fit together in a seamless universe for the senior population.

For me, the interesting aspect of these transitions has been the legal construct that determines, in writing, when each move has to take place. The written contracts of independent living facilities, for example, spell out in writing a number of telltale factors that determine when someone has to move to assisted living. For relatives like me who like to avoid confrontation, that can be a godsend. In my parents' case, the second time the fire department had to come because the stove had been left on effectively ended five years of independent living.


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As for assisted living, the word "assisted" is the key. The assumption is that the resident can move around on their own steam and that they can eat without help. A subunit within most assisted living facilities is termed a "memory unit," which is for people who are suffering from increased confusion but who can still get through the day normally. The level of supervision is one notch higher than in the regular assisted living area.

Finally, there is a point at which a skilled nursing facility is a necessity. This is the point at which a resident is having difficulty walking (even with a walker) or when they need help eating. Again, the contractual relationship spells out these specific requirements that prompt the move from assisted living to the SNF.

The amount of money required for this progression of events is significant. Just so you know, assisted living can be in the $5,000 per month range. High-end skilled nursing facilities are more like $10,000 per month. There are definitely more cost-effective alternatives starting with veterans' homes and those operated by religious organizations, but all are expensive by any measure.

Old people simply need and deserve a lot of help, and from my exposure now to those who work in all three levels of the gerontology service industry, I can't imagine a more caring and compassionate group of people. In my experience, no occupation requires as much patience and an upbeat disposition in the face of difficult challenges from hour to hour. Only very special people gravitate to this industry.

So, how does the average person prepare for the inevitable? I've written about the extent to which long-term care policies may not be the right approach -- given increasing premiums and the fact that someone dying suddenly may never receive a benefit. I think a better option is to try to save more money. A non-working second spouse should consider going back to work and depositing all of the first $23,000 of earnings directly into a 401(k). Everybody in their late 50s should try to be at the max or as much as they can possibly afford.

Then, resist the temptation right now to sell the house. While I'm not a believer in market timing, I do know that basic commodities, like real estate, can exhibit a "snap-back" effect after a major downdraft. This seems to be happening now in residential real estate. So few houses are on the market that multiple offers are back, and this marks the beginning of a major run-up in home prices. At the end of the day -- or life in this case -- home equity may go a long way toward paying for the levels of care I've just described.

So, if this information is sobering, don't sell the house quite yet and try to save more. As for my father, when I was telling him that he will be here in California where I can visit him every day, his response was, "Oh, I don't think I'm going to want to see you EVERY day." It looks like his sense of humor may be the last thing to go.

Stephen J. Butler is CEO of Pension Dynamics. Contact him at 925-956-0506 or sbutler@pensiondynamics.com.