Caring for Your Aging Parents

Caring for your aging parents is something you hope you can handle when the time comes, but something you probably hope you never have to do. Caring for your parents includes helping them plan for the future, and this can be overwhelming, both physically and emotionally. Let’s not forget about the financial toll on your long-term financial security. When the time comes, you may be certain of only two things: your parents need you, and you need help.

Start caring for your aging parents by talking with them about their needs and wishes. In some cases they may not be willing to talk to you about their future, either because they are afraid to face it or they resent your interference. If this is the case, you may need to do as much planning as you can without them.

The first step you should take is to prepare a personal data record. A personal data record lists information you might need in case your parents become incapacitated or die. This record should include all financial, legal, medical, insurance and professional advisor information, as well as the location of important records.

Once this record has been assembled, prepare a statement of financial position for your parents including sources of cash, projected uses of cash and available assets such as mutual funds that can be liquidated to cover cash shortfalls. Making sure that your parents won’t outlive their money is a critical step in ensuring that your own finances will remain sound.

You can’t know everything, and you probably don’t have enough time to learn everything you need to know. That’s why you should seek advice from professionals. If you live far from your parents or are too overwhelmed to handle all your parents’ affairs, you can hire a geriatric care manager who will evaluate your parents’ situation, suggest options, and coordinate professionals.

Don’t try to care for your parents alone. Many local and national caregiver support groups and community services are available to help you cope with caring for your aging parents. If you don’t know where to start finding help, call the Eldercare Locator, (800) 677-1116, an information and referral service sponsored by the federal government that can direct you to resources available nationally or in your area.

What kind of advice will you need?

Your parents’ housing choice will depend upon how healthy they are. As your parents grow older, their health may deteriorate so much that they can no longer live on their own. At this point, you may need to find them in-home health care or health care within a retirement community or nursing home. On the other hand, you may want them to move in with you.

If your parents need financial assistance, you may need to contact professionals whose advice both you and your parents can trust, such as a financial advisor.

Legal advisors can help you plan for your parents’ incapacity by preparing the appropriate documents, contacting nursing home ombudsmen and establishing and monitoring guardianship.

What kinds of support and community services will you need?

If you are uncertain of your parents’ mental or physical capabilities, your parents can undergo a geriatric assessment. They will be evaluated to determine their capabilities and whether they can take care of themselves on a day-to-day basis.

If you need to work or run errands but you can’t leave your parents alone, consider using adult day care. These programs are located in hospitals, churches, temples, nursing homes or community centers. Although it can be expensive, the cost may be subsidized by Medicare, Medicaid, long-term care insurance or health insurance.

You may feel better about taking care of your parents if you are armed with knowledge. You may want to complete first-aid courses or take classes in gerontology.

Many caregiver support groups are available to provide information and emotional support. You may find these support groups helpful if you know little about caring for your aging parents.

Financial and tax considerations for you

Caring for your aging parents is often both an emotional and financial burden. Because many adults today are becoming first-time parents in their thirties, and others are remarrying and rearing second families, increasing numbers of adults are finding themselves in the “sandwich generation.” They face having to pay expenses of growing children, plan for their own retirement, and support their aging parents financially. Thus, it’s important to plan not only your parents’ finances, but your own as well.

If it is clear that your parents won’t have enough resources to pay for their own care, you may need to determine how this shortfall will be met. To do so requires a comprehensive analysis that determines what level of support you can provide without jeopardizing your financial security.

Federal income tax law provides several tax benefits if you are supporting your parents financially. For example, you may qualify for the dependent care credit, dependency exemption and medical expense deductions.

Maintain focus

Clearly this is a very complicated life event that can create a tremendous amount of emotional and financial stress. However, proper planning can help reduce the anxiety allowing you to focus your attention on helping your parents when the time comes.

Truepoint Wealth Counsel is a fee-only Registered Investment Adviser. Registration as an adviser does not connote a specific level of skill or training. More detail, including forms ADV Part 2A & 2B filed with the SEC, can be found at TruepointWealth.com. Neither the information, nor any opinion expressed, is to be construed as personalized investment, tax or legal advice. The accuracy and completeness of information presented from third-party sources cannot be guaranteed.

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