by Jill Ciccarelli Rapps, CFP®
In 2016, more than 10 million Americans – about 3% of the U.S. population – served as the primary caregiver for their elderly parent.
The continuum of caregiver responsibilities vary based on needs, but often involves the daily basic care needs such as feeding, administering medicine, and helping with personal hygiene; as well as financial and emotional support.
As a caregiver, your obligations to your parent or love done can be draining – both financially and mentally – so it is crucial to have a plan in place. By preparing for your role as a caregiver, you should ensure that all of their needs are met while still taking care of your own.
Here are some key tips to keep in mind to make the most of your time as a caregiver:
HAVE THE CONVERSATION EARLY
If possible, talk to your parents before their health degrades about putting a plan in place. By preemptively addressing these concerns in advance of need, you can prevent many of the hiccups that you are bound to encounter.
First, take a look at both of your parent’s financial resources and your personal financial situation. This crucial first step can help you to determine what options are feasible for your family to consider, and can help you to make decisions about filling any gaps that may lead to financial hardship.
You should also draft a living will, and establish power of attorney and a healthcare proxy. The best approach is to partner with your financial advisor and attorney to develop a plan that meets your needs.
GATHER ALL THE NECESSARY PAPERWORK
You will also want to compile all of the necessary paperwork for your loved one’s next stage in life. Create a file of their important documents and ensure that this file is kept in a secure location that can be accessed by all parties concerned.
You will need to collect:
- Income information including pension, 401(k) and retirement plans, and SSI benefits
- Savings bonds, stock certificates, and annuity contracts
- Partnership, corporate, or company operating agreements
- Tax returns
- List of all bank accounts
- Documentation of any loans, debts, or credit cards or accounts
- Copies of their health and life insurance policies
- Medicaid/Medicare information
- Social security cards and birth certificates
- Property deeds and vehicle titles
- Contact information for their medical doctors and insurance agents
- Power of attorney, healthcare power of attorney, living will, and/or authorization to release healthcare information
- Medical histories and prescription information
DEVELOP A BUDGET
Once you understand the full extent of your combined resources and have gathered your key documents paperwork, you should develop a budget. Though it may be difficult to determine a budget before you know the full extent of your parent’s health care costs, a financial planner can provide an informed estimation about their living expenses.
When creating your budget, consider all costs – not just medical and hospice care, but also factor in their day to-day living expenditures (housing, food, utilities, etc.). Determining your budget can also help you decide if your parents should move in with you, if you can leave your job to provide full time care, or if you can hire outside help.
Most importantly, a well formulated budget can help reduce the mental and emotional stress that arise from financial woes.
GET HELP WHENYOU NEED IT
No one will ever be able to care for your parents like you can. However, that does not mean compromising your own future financial security for the sake of being their caregiver. If caring for your aging parents becomes unmanageable, tap into some of the resources that are available in your community.
For instance, a financial planner can provide you with the clarity and insight you need to plan your budget effectively. Additionally, there are myriad benefits available through Medicare and Medicaid, as well as free or low-cost government programs that can assist you in finding quality hospice care and medical support. Make sure that you take the time to learn about the full extent of these benefits!
Though caring for your aging parent is a difficult prospect to consider, it is critical for you to develop a comprehensive plan in the event that you find yourself in this position. By properly planning for future needs, budgeting for medical and living expenses, and seeking out community resources, you can effectively provide financial and emotional support for your aging parent.
Jill Ciccarelli Rapps, CFP®
Ciccarelli Advisory Services, Inc. is located at
9601 Tamiami Trail North, Naples, FL
Jill Ciccarelli Rapps is a CERTIFIED FINANCIAL
PLANNER®, a trained life coach and a partner of Ciccarelli
Advisory Services, Inc., a family-focused wealth management firm
in Florida and New York.
Investment advisory services offered through Ciccarelli
Advisory Services, Inc., a registered investment adviser independent
of FSC Securities Corporation. Securities and additional
investment advisory services offered through FSC Securities
Corporation, member FINRA/SIPC and a registered