Your Financial First Aid Kit: Caring for Aging Parents

In our last blog, you read about the importance of establishing a financial first aid kit. Financial emergencies – just like medical ones – can happen at any time, and it’s important to have a “first aid kit” of savings, plans, and people that can help you come out the other side of financial burdens. Most Americans aren’t financially prepared to handle a $1,000 emergency expense – having a financial first aid kit can make sure you’re not one of them.

Many Americans budget for childcare, but one of the other most common expenses happens at the other end of the generational spectrum: Caring for sick or aging parents. Below, we’ll outline some of the tools that should be in your financial first aid kit as you prepare to care for your parents.

The Expense: Caring for Aging Parents

While we all hope and expect that our parents will stay healthy as they age, the truth is, many of our parents will need some type of care in the future. The Department of Health and Human Services now estimates that 7 in 10 seniors over age 65 will need some type of long-term care, and that care isn’t cheap.

The estimated cost of assisted living for seniors is $48,000 per year – or $4,000 a month – and a private room in a nursing home facility costs an average of $290/day. Some of the most common long-term care conditions, like Alzheimer’s, are often called the most expensive diseases in America – from diagnosis to death, caring for one Alzheimer’s patient costs an average of $341,000, and families typically pay 70% out of pocket.

The Tools: Financial Advisor

When it comes to caring for your parents the way your family wants to, choosing the right Financial Advisor can be just as important as choosing the right doctor. Well before you’re faced with the prospect of paying for long-term care, it’s important to find a trusted Financial Advisor that can help you think through the costs associated with it.

A Financial Advisor can help you evaluate your personal situation, as well as your parents’ situation, and establish a savings and investment plan to meet your unique needs for your family. From caring for aging parents to achieving your own retirement desires, a Financial Advisor can help balance all your long-term goals so you can live the way you want to.

The Tools: Estate Attorney

Dealing with financial issues while caring for your parents can be uncomfortable. That’s why hiring a trusted estate attorney is important. A good estate attorney can help ensure that your parents’ assets are passed down in the ways that work for them, without risk of fraud. That could mean establishing a living trust, estate planning, aiding with long-term care placements, or even becoming a power of attorney.

No matter what your unique situation, having both an estate attorney and a Financial Advisor on your team means you’re maximizing the amount of financial resources available to you and smartly planning how those assets are used.

The Tools: Local, State, and Federal Financial Resources

Together, a good Financial Advisor and estate attorney – along with other experts – can help you identify government resources and aid in advocacy for both you and your parents.

Whether you’re looking for a long-term care facility or planning to care for your parent at home, there are resources federal, state, and local financial resources to look into. Local Area Agencies on Aging are non-profits designed to address the needs of your parents all in one place, including connecting them with meal and caretaking services. If you’re electing to care for your parents in your own home, many states offer caregiver respite programs designed to advocate for your needs as a caretaker. And federal programs like Medicaid, Veterans Aid, and Supplemental Security Income can help your parents and you financially as you consider long-term care options.