New Update: Healthcare Costs Increasing by Over 60% in Some States. Will you be impacted?

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

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

Seven in ten Travelers 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.

Travelers 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.

Featured Video

Articles you may find interesting:

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.

GenWorth.com, 2022

ACL.gov, 2022

How does the Travelers 401(k) Savings Plan compare to market standards, and what strategies can employees implement to maximize their retirement benefits while working at Travelers, considering the various contribution options available?

Travelers 401(k) Savings Plan Comparison to Market Standards: The Travelers 401(k) Savings Plan offers immediate eligibility upon hire, automatic enrollment, and flexible contribution options between 1% and 75% of pay, with a mix of pre-tax and Roth options. Employees benefit from a generous dollar-for-dollar employer match on the first 5% of eligible pay, up to $6,000 annually. To maximize retirement benefits, employees should consider contributing at least enough to receive the full employer match and periodically review their investment choices with the aid of Financial Engines, an independent advisory firm provided by Travelers.

In what ways does the Travelers Pension Plan provide a safety net for employees as they transition into retirement, and how does participation in this defined benefit plan impact financial planning for retirement among long-term employees?

Impact of the Travelers Pension Plan: The defined benefit Pension Plan at Travelers, funded entirely by the company, provides a secure foundation for retirement with benefits based on age, salary, and years of service. This plan is crucial for long-term financial planning as it guarantees a predictable income stream in retirement, supplementing savings and Social Security benefits. Employees are eligible after one year of service, which encourages long-term commitment and aids in retirement readiness.

What resources does Travelers offer to assist employees in making effective investment decisions within their 401(k) plans, and how can employees leverage these resources to reach their personal retirement goals?

Investment Decision Resources in Travelers 401(k) Plans: Travelers offers resources such as Financial Engines to assist employees in making informed investment decisions within their 401(k) plans. This service helps employees tailor their investment strategies to their individual retirement goals and risk tolerance. Engaging with these resources can significantly enhance employees' ability to grow their retirement savings effectively.

How can employees best understand the interplay between their personal savings and the benefits provided by Travelers, particularly in relation to healthcare and retirement planning as they age?

Interplay Between Personal Savings and Travelers Benefits: Understanding the interplay between personal savings and company-provided benefits is vital for comprehensive retirement planning. Travelers employees should consider how their benefits package, including health care, life insurance, and disability coverage, complements their savings and Social Security. Regular consultations with financial advisors provided through the company can help employees strategize effectively as they age.

What should employees at Travelers know about the eligibility requirements and benefits associated with the company's Long-Term and Short-Term Disability policies as they prepare for a secure retirement?

Understanding Disability Policies at Travelers: Travelers provides both short-term and long-term disability coverage, which is crucial for protecting income in the event of an unforeseen health issue. Short-term disability covers up to 13 weeks at varying pay levels, while long-term disability kicks in for more severe cases, offering up to 60% of base salary. Employees should familiarize themselves with these policies early to ensure comprehensive coverage as they approach retirement.

How does the company's Paid Time Off (PTO) policy under Travelers facilitate work-life balance, and what implications does this have for employees' long-term health and preparedness for retirement?

Benefits of Travelers PTO Policy: The Paid Time Off (PTO) policy at Travelers allows employees to accrue significant time off based on service length, enhancing work-life balance and contributing to long-term health and well-being. This policy supports employees in maintaining a healthy work-life balance, which is crucial for long-term career sustainability and retirement preparedness.

What strategies can employees implement to effectively utilize the Educational Assistance Program offered by Travelers not only for their personal development but also as a way to enhance their retirement planning prospects?

Utilizing the Educational Assistance Program: Travelers' Educational Assistance Program supports employees in pursuing further education relevant to their professional growth and retirement planning. By investing in additional qualifications and skills, employees can not only enhance their career prospects at Travelers but also increase their earning potential for better retirement savings.

How does the Business Travel Accident Plan improve the overall financial protection for employees at Travelers, and what are the claims procedures if an incident occurs while conducting company business?

Financial Protection through the Business Travel Accident Plan: The Business Travel Accident Plan provides a safety net by offering coverage of up to three times the annual base salary, up to $2 million. This plan is crucial for financial protection against unexpected incidents during business travel, and employees should understand the claims procedures to utilize this benefit effectively.

In terms of post-retirement benefits, how does Travelers support its retirees concerning access to resources like financial planning services or health benefits?

Post-Retirement Benefits at Travelers: Travelers supports retirees by offering access to financial planning services and health benefits. These resources are vital for maintaining financial stability and health during retirement. Retirees should actively engage with these services to optimize their retirement lifestyle and financial management.

For employees looking for further information or assistance regarding their retirement plans and benefits at Travelers, what are the best ways to contact the company to ensure they receive accurate and timely information?

Accessing Retirement Plan Information at Travelers: Employees seeking information or assistance regarding their retirement plans can contact Travelers' Employee Services Unit via email at 4-ESU@travelers.com or by calling 800.441.4378. Utilizing these channels ensures employees receive accurate and up-to-date information about their retirement benefits.