Talking about money can be awkward in almost any relationship. But no matter how sensitive, it’s especially important to broach the subject with an aging parent. The stakes are just too high not to have the conversation that can help both of you plan for the future and protect yourselves from the high cost of long-term care. With a supportive approach, the results can lead to maximizing any available resources and ensuring critical needs are met.
Our clients ask us both how to start the discussion and for tips to ensure that you have the information you need to make informed long-term care decisions. Let us share several ways you can help an aging parent with their finances once you start the conversation.
The first step in the process is to gather information. Consider it a fact-finding mission with the objective of getting an accurate view of their full financial picture. Do not hesitate to ask your parents for help. Chances are they will know where their information is located and have access to hard-to-reach places such as bank accounts and safety deposit boxes.
Once gathered, this information can be consolidated into a single sheet of paper, or digital file. Start by asking your elder parent if he or she has such a document. If not, set out to create one. This will not only be the basis for a way forward, but can help you gauge the financial management capabilities of your parent.
On this list make sure to include bank account totals and account numbers, insurance policies and associated provider data, investment figures, bills, debts, sources of income, and anything else that applies. If your parent is already receiving public benefits such as veterans pension or Medicaid benefit, this should be included.
After gathering as much information as possible and getting an idea of the elder parent’s overall financial status, make an assessment. What is the state of their financial affairs? Do they have piles of unopened and unpaid bills laying around? Are they making payments they don’t have to? What’s the status of their home, taxes, Social Security income, investment fees, and liabilities? If they had to pay for long-term care, could they add it into their monthly budget.
From here, turn to asking the tough questions. Do your parents have their estate plans in order? This includes last wills and testaments, trust agreements, healthcare directives, powers of attorney, and other important legal considerations. When were these documents last updated? If they had to pay for long-term care, could they add it into their monthly budget. Are they working with an estate planning and elder law attorney right now to prepare for the future?
Although it may be difficult to start this conversation, it is very important to start sooner rather than later. You do not want to wait until an elder parent becomes medically incapacitated or otherwise unable to participate in this all-important process. Do you have questions on how to help your aging parent or need more advice? Do not wait to contact us to let us know.