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Cabot Employees: Navigating the Complexities of Extended Care Costs in Retirement

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Addressing the potential risks of extended-term care expenses may be one of the biggest financial challenges for Cabot employees who are developing a retirement strategy.

Seven in ten Cabot employees over age 65 can expect to need extended care services at some point in their lives. So understanding the various types of extended care services – and what those services may cost – is critical as you consider your retirement approach.

What Is Extended Care?

Extended care is not a single activity. It refers to a variety of medical and non–medical services needed by those who have a chronic illness or disability – most commonly associated with aging.

Extended care can include everything from assistance with activities of daily living – help dressing, bathing, using the bathroom, or even driving to the store – to more intensive therapeutic and medical care requiring the services of skilled medical personnel.

Extended care may be provided at home, at a community center, in an assisted living facility, or in a skilled nursing home. And extended care is not exclusively for the elderly; it is possible to need extended care at any age.

How Much Does Extended Care Cost?

Extended care costs vary state by state and region by region. The 2021 national average for care in a skilled care facility (single occupancy in a nursing home) was $108,405 a year. The national average for care in an assisted living center (single occupancy) was $54,000 a year. Home health aides cost a median of $27 per hour, but that rate may increase when a licensed nurse is required.

What Are the Payment Choices?

Often, extended care is provided by family and friends. Providing care can be a burden, however, and the need for assistance tends to increase with age.

Cabot employees who would rather not burden their family and friends have two main choices for covering the cost of extended care: they can choose to self-insure or they can purchase extended care insurance.

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Many self-insure by default – simply because they haven't made other arrangements. Those who self-insure may depend on personal savings and investments to fund any extended care needs. The other approach is to consider purchasing extended care insurance, which can cover all levels of care, from skilled care to custodial care to in-home assistance.

When it comes to addressing your extended care needs, many look to select a strategy that may help them protect assets, preserve dignity, and maintain independence. If those concepts are important to you, consider your approach to extended care.

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What is the primary purpose of Cabot's 401(k) plan?

The primary purpose of Cabot's 401(k) plan is to help employees save for retirement by allowing them to contribute a portion of their salary on a pre-tax basis.

How can employees enroll in Cabot's 401(k) plan?

Employees can enroll in Cabot's 401(k) plan by completing the enrollment process through the company's benefits portal during the enrollment period or after they become eligible.

What is the eligibility requirement for Cabot's 401(k) plan?

Employees at Cabot are generally eligible to participate in the 401(k) plan after completing a specified period of service, typically outlined in the employee handbook.

Does Cabot offer any matching contributions to the 401(k) plan?

Yes, Cabot offers a matching contribution to the 401(k) plan, which is designed to encourage employees to save for retirement.

How often can employees change their contribution rates to Cabot's 401(k) plan?

Employees can change their contribution rates to Cabot's 401(k) plan at any time, subject to the plan's guidelines.

What investment options are available in Cabot's 401(k) plan?

Cabot's 401(k) plan offers a variety of investment options, including mutual funds, target-date funds, and other investment vehicles to suit different risk tolerances.

Can employees take loans against their 401(k) balances at Cabot?

Yes, Cabot allows employees to take loans against their 401(k) balances, subject to the terms and conditions of the plan.

What happens to Cabot's 401(k) plan if an employee leaves the company?

If an employee leaves Cabot, they can choose to roll over their 401(k) balance to another retirement account, cash out, or leave the funds in the Cabot plan if eligible.

Are there any fees associated with Cabot's 401(k) plan?

Yes, there may be administrative fees and investment-related fees associated with Cabot's 401(k) plan, which are disclosed in the plan documents.

How can employees access their 401(k) account information at Cabot?

Employees can access their 401(k) account information through the online portal provided by Cabot's plan administrator.

With the current political climate we are in it is important to keep up with current news and remain knowledgeable about your benefits.

Cabot announced a restructuring plan that includes layoffs of 200 employees and a freeze on salary increases for the next year.

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For more information you can reach the plan administrator for Cabot at 2 Seaport Lane, Suite 1300 Boston, MA 2210; or by calling them at +1 617-345-0100.