How to Prepare for the Cost of An Aging Parent
Getting old is not for sissies.
And this is equally true: serving as the caregiver for your mom and dad may take all that courage and more.
Make no bones about it. You may very well need the wisdom of the sages, the flexibility of a circus gymnast, and an army of counselors and advisers to successfully navigate the obstacle course reserved for those committed to caring for aging parents. Especially if your parents don’t want to cooperate, you can anticipate reaching the outer limits of your emotional bandwidth trying to serve them.
No matter how young or old, how healthy or infirm your parents may be now, you should take note of these guiding principles. Time and attention invested now will pay off in spades if a season of real crisis appears.
#1 Time Is Not On Your Side
The time to talk about “elder care issues” is NOW! Putting off the big discussion about your parents’ wishes, asset management, their insurance, care-planning and estate issues can very well leave you trying to navigate a House of Horrors with your hands legally tied and your eyes blindfolded.
Shared silence endangers the quality of their own last days and, perhaps, your own financial security as well. At the very minimum, these five legal documents need to be in place:
A. A medical directive or “living will”
B. A medical power of attorney and HIPAA release
C. A durable power of attorney for finances
D. A revocable living trust
E. A legal will
Understand that these documents must be completed while each parent is mentally capable of making his or her own decisions. If one slips into an advanced state of dementia or suffers a stroke or head injury, then the difficulty of your journey is compounded unnecessarily. Ask us for a list of estate planning attorneys that can help you create these documents.
Secondly, a list of your parents' financial assets needs to be available, preferably including account numbers, recent statements and contact information for any responsible financial agents. Knowing where their most recent tax records are held may be helpful as well.
#2 Know that Every Move You Make Carries Legal and Financial Implications.
Consider this scenario.
Because of a serious debilitating condition, your parents face a decision involving long-term nursing care. Medi-Cal or Medicaid can offer what amounts to a financial life preserver. But Medi-Cal can deny payments for lots of reasons, can demand answers about your parents’ spending decisions, and can seize your parents’ home for repayment of long-term care expenses even if a will already exists to pass their home on to you! Regulations vary from state to state, so doing your homework is critical.
#3 Understand Your Parents' Assets and Debts
Getting involved in your parents’ finances may seem intrusive to them, but it’s really important for both their sake and yours as well.
Debts may pass through to your parents’ estate and could affect you. Those obligations will vary according to their state of residence, the companies to which they owe money, and their insurance coverage.
It’s a clear fact that, as parents age, they become more prone to making costly mistakes AND stand a much greater chance of being targeted by those who would take advantage of them.
If your parents own their home or have debt obligations against it, make sure they are current on payments. Credit card statements can also give you a snapshot of their finances.
No one knows for certain what you or any other member of your family may face in coming years. Your true security comes with understanding and carefully managing the assets you gain during your productive years, assets sufficient to face life’s sudden jolts and challenges fearlessly.
We help people build that security. We work with you to grow real wealth which can provide for a rewarding lifestyle and stand sentry against scary financial seasons. Let us help you manage the transitions of your parents’ lives and yours as well.
Please contact us for a free analysis of your current portfolio. (424) 288-4254.
Sources: (1) Pulawski, Shirley. “Eight Essential Things to Know When Estate Planning for Aging Parents.” My Bank Tracker. mybanktracker.com. Nov. 20, 2014. (2) Costal, Karen. “5 Legal Documents you Need for Your Loved Ones” caring.com/checklists. Dec. 12, 2014. involving long-term nursing care. Medicare or Medicaid can offer what amounts to a financial life preserver. But Medicare can deny payments for lots of reasons, can demand answers
Investment advice is offered by Horter Investment Management, LLC, a Registered Investment Adviser. Insurance and annuity products are sold separately through TWP Financial. Securities transactions for Horter Investment Management clients are placed through Pershing Advisor Solutions, Trust Company of America, Jefferson National Monument Advisor, Fidelity, Security Benefit Life, ED&F Man Capital Markets and Wells Fargo Bank, N.A.