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When your aging parent needs help, it’s often up to you. Here are 24 tips on how to make it work.
By MSN Money staff
Some parents may not feel comfortable divulging financial information, even to their children. It’s not important that the whole family know the details of their finances. What is important is that your parents, as they age, gather the information, are prepared for the possibility of incapacity and consider how to pay for long-term care if necessary.
To begin, start with the paperwork:
• Attitude is everything. If you try to boss your parents around, they might reject any help from you at all. Failing to act, however, can have serious consequences, both financially and health-wise. (See “3 steps to help parents grow old gracefully.”)
• Find out where they keep important papers, including a will, powers of attorney, safe-deposit-box information, birth and marriage certificates, dissolution certificates, Social Security and military service records, and insurance policies. (See “9 vital money questions for Mom and Dad.”)
• Make lists of pensions and investments, property and financial advisers.
Can they stay at home? Your parents could live independently just fine for a while. For extra peace of mind:
• Find out if they’re paying the bills. If not, sign them up for online or automatic bill pay. That way, you can also sign in to make payments. You have other options, but consult an attorney before taking more drastic steps, such as joint bank accounts, a living trust, financial power of attorney or guardianship.
• Make sure they fill their prescriptions. Look into state or drug makers’ programs to help reduce the cost. Consider mail-order drugs that update automatically each month; ask about lower-cost generics; join a Medicare plan for prescription drug coverage.
• Do a safety check and fall-proof the house, including tacking down loose carpets, tossing throw rugs and removing thresholds. Install handrails, grab bars and nonslip strips in the shower.
• Consider meal delivery services.
• Bring in a home-care nurse if needed, but be prepared to pay. Annual costs for home care can top $20,000. (But still less costly than Assisted Living Facilities).
• Get a medical-alert system so your parents can push a button for help.
If they can’t live at home: At some point, your parents may need more daily help, and moving them in with you might not be the best option. Many assisted living facilities offer graduated levels of care and can meet your parents’ needs with less than 24-hour-a-day service.
Select the lowest possible level of care. Medication, bed-to-wheelchair transfers, bathing and dressing help can be provided. Your parents have their own room but eat in a common room and have access to social activities. Help your parents keep as much of their lifestyle and mementos as possible. (See “Ease your parents’ move to a home.”)
Assisted living facilities vary in cost. What you need to know:
• Medicare does not pay for assisted living services, so you and your parents will have to foot the bill.
• Know what you’re paying for. Additional fees are billed separately for services such as extra nursing, equipment and rehabilitation.
• Before you sign a contract, ask if the facility requires medications to be packaged in single-dose packets. This can add as much as $6,000 per year to costs.
• Facilities that offer graduated care are good insurance should your parents’ money run out. Most assisted-living facilities give priority for their Medicaid-funded beds to current residents.
Is more care needed? A nursing home would be the next step. Nursing homes are designed for people unable to care for themselves.
Long-term care is expensive, and a nursing-home stay can cost $75 to $235 per day. Under certain conditions, Medicare might cover some of the cost.
How to pay for it all: Typically, Social Security, pensions and savings fund our later years, but there are options to pay for health care and other expenses:
• Sell the house, difficult as it might be, to free up cash.
• Keep the house: Reverse mortgages allow homeowners over 62 years old to access money built up as equity. The home does not need to be paid off. The balance of the reverse mortgage is paid off as a part of the sale. However, one homeowner does need to live in the house until it is sold.
• Medicare: The process begins at age 65, when all who’ve paid into the system during their career receive Medicare Part A, which covers inpatient hospital costs and skilled-nursing home care.
• If the kids are grown, cash out the life insurance and reinvest in something that provides a predictable monthly income.
• Taxes: Keep track of medical bills. Medical expenses are deductible if they exceed 7.5% of adjusted gross income.
• Credit cards: They’re a bad idea for seniors on fixed incomes. The payments erode financial flexibility and use up cash. Advise your parents to switch to lower-interest cards and ditch the debt.
What about you? As much as you might want to, you can’t do it all. Decide what you are willing to do, then stick with it.
• Get some help with community services (meal delivery, adult day care, etc.) and recruit relatives or friends. (See Community Services)
• Build an emergency fund. Even if you’re not paying directly for your parents’ care, you’ll encounter plenty of expenses. (See “Why you need $500 in the bank.”)
• Don’t try to carry your parents’ debts. You can’t be held responsible for their debts, unless you co-signed a loan, added them to a credit card or otherwise took legal responsibility for their obligations.
• Heed your parents’ lessons and don’t delay saving for your own retirement. (See “8 money moves you must make at 50.”)
SOURCE: MSN Money
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