Addressing the potential risks of extended-term care expenses may be one of the biggest financial challenges for United Parcel Service employees who are developing a retirement strategy.
Seven in ten United Parcel Service 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.
United Parcel Service 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.
GenWorth.com, 2022
ACL.gov, 2022
What is the 401(k) plan offered by United Parcel Service?
The 401(k) plan at United Parcel Service is a retirement savings plan that allows employees to save a portion of their paycheck before taxes are taken out.
Does United Parcel Service match employee contributions to the 401(k) plan?
Yes, United Parcel Service offers a matching contribution to the 401(k) plan, which helps employees boost their retirement savings.
How can employees enroll in the 401(k) plan at United Parcel Service?
Employees can enroll in the 401(k) plan at United Parcel Service through the company’s HR portal or by contacting their HR representative for assistance.
What is the eligibility requirement for United Parcel Service's 401(k) plan?
To be eligible for the 401(k) plan at United Parcel Service, employees typically need to meet certain criteria regarding their length of service and employment status.
Can employees at United Parcel Service change their contribution amounts to the 401(k) plan?
Yes, employees at United Parcel Service can change their contribution amounts to the 401(k) plan at any time, subject to the plan's rules.
What investment options are available in the United Parcel Service 401(k) plan?
The United Parcel Service 401(k) plan offers a variety of investment options, including mutual funds, stocks, and bonds, allowing employees to choose based on their risk tolerance.
When can employees at United Parcel Service start withdrawing funds from their 401(k) plan?
Employees at United Parcel Service can typically start withdrawing funds from their 401(k) plan at age 59½, although there are specific rules regarding hardship withdrawals.
Does United Parcel Service provide financial education regarding the 401(k) plan?
Yes, United Parcel Service offers financial education resources and workshops to help employees understand their 401(k) plan and make informed investment decisions.
Are there any fees associated with the United Parcel Service 401(k) plan?
Yes, like most 401(k) plans, the United Parcel Service 401(k) plan may have administrative and investment fees, which are disclosed in the plan documents.
How often can employees at United Parcel Service review their 401(k) account statements?
Employees at United Parcel Service can review their 401(k) account statements quarterly, and they may also access their account online at any time.
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