Can I take it with me when I go?
“I don’t want much, but I do want to see my grandkids.”
The emotion in her statement was visible. Lying just beneath the surface, simmering, threatening to boil over if another ounce of pressure was applied.
She was a proud woman. She had worked hard a lifetime, raised a family of three - often on only one income - and somehow she had kept it all moving forward. Sure, she hadn’t done it alone. He was right there beside her, working just as hard to be a good husband, father and provider. But it was she who had assumed the job of minding the money. She who had always kept an eye on their cash flow, paid the bills and planned for their retirement.
But she had not planned for this.
For more than 25 years they had been covered by his Group Health Plan. Having a prescription or a tooth filled was just something they did. Not something for which they budgeted. When friends had retired, they had taken those benefits with them. She had assumed they would do the same. But she had assumed wrong.
With nearly $300 a month needed to purchase a health plan, would there be enough money left over to visit their grandchildren in Alberta? It was a blow to their budget. It was an even bigger blow to her confidence and now fear had set in.
She hadn’t planned for that.
Even if you are one of the rare few who will retire with an employer sponsored pension plan, don’t assume you can take all your other employer benefits with you when you go. Specifically, most group health plans will cease once an employee retires. For those health plans that do continue, most will have annual or lifetime maximums that severely limit their coverage. Those without limits, will exclude any pre-existing conditions that the group plan had previously covered. Finally, while the employer may have cost shared the group plan pre-retirement, when you retire that cost is all on you.
What’s a Retiree to do?
The first thing to do to avoid finding yourself in this situation is to simply ask the question: “Can I take it with me when I go?”
I am always amazed at how little we advocate on our own behalf and how much we take for granted. Especially when dealing with our employers. Some of us still have the mentality - even as a “have” province – that we are lucky to have a job and dare not question our benefits. Still others don’t ask for fear of appearing uninformed. Whatever the reason, it will only hurt you in the long run. If you don’t want to talk to your boss or HR directly, take your benefits booklet to a Financial Advisor who will help you understand it.
This particular retiree that I worked with was one of the lucky ones. Despite losing group coverage and having to pay for their own plan, they did have Assured Access in place via their employer. This innovative product available only through Medavie Blue Cross, had taken a snapshot of their health years earlier - years before the need for hypertension and high cholesterol meds had become their reality. By having that plan in place, they could not be denied coverage for those prescriptions on their new plan. Imagine the heartache - not to mention financial hardship - of having to purchase a health plan plus pay for drugs that the plan did not cover? Sadly that is the norm for far too many retirees and one that can be easily avoided by asking some questions and working with a professional.
If your retirement dream is to lay on a sandy beach or simply play in the sandbox with your grandkids, start by asking the right questions now. It could mean the world of difference later.