FINANCIAL CARE FOR YOUR AGING PARENT
Lise Andreana, CFP, CPCA
Self-Counsel Press
(a division of)
International Self-Counsel Press Ltd.
USA Canada
Copyright © 2014
International Self-Counsel Press
All rights reserved.
Introduction
By the year 2021, it is estimated that there will be 6.7 million seniors in Canada. By 2041, this number will grow to 9.2 million, meaning that one in four Canadians will be a senior.[1] The statistics for the United States show a similar growth pattern for the aging population with 55 million achieving senior status by the year 2020 — a 36 percent increase over the next decade. The driving force behind this growth is the well-known “Baby Boom” between 1946 and 1965 that saw a dramatic increase in the number of children being born during that period.
With the fastest growing segment of the senior population being those older than age 85, and knowing that 70 percent of Boomers still have at least one living parent, that means many of the Boomer generation will be faced with the prospect of caring for their aging parents right at the same time they are approaching their own retirement. Clearly, Boomers are headed for a crisis; one they may not have anticipated.
As our society moves away from institutional care, more seniors are staying in their homes and/or being cared for by family members. Almost 50 percent of seniors suffer from a disability. Even more shockingly, more than 80 percent are suffering from a chronic health condition.
Currently, more than 90 percent of caregiving in Canada is provided by either a family member or friend. The impact this role can have on caregivers can be as simple as missing out on socializing with other family and friends to more significant consequences such as fatigue, sleepless nights, and emotional or financial stress. Caregivers may also suffer lost wages due to time missed at work, as it is estimated that it costs Canadian businesses $16 billion a year when employees take time off to care for a loved one. This missed time can also result in losing out on opportunities for promotion, a reduction in savings capacity for their own retirement plans, and smaller pension plan amounts after being forced to retire early.
As aging parents face diminishing health — both physical and mental — it becomes increasingly more challenging to work with them to understand their financial situation and their personal wishes for living arrangements and care, and to protect their interests. Difficult emotions often come into play. Disagreements with siblings are common. Finding all their relevant legal and financial documents can feel overwhelming.
This book aims to provide you with the tools you need to —
• prepare for the possibility of taking on a caregiving role,
• balance your own retirement needs with those of your aging parents,
• create a sustainable financial plan for your parents,
• find resources that provide the services you may need (some at reduced costs),
• track your parents’ finances,
• prepare for and select a retirement facility, and
• assist your parents with the sale of their home.
There is no time like the present to begin preparing for your aging parents’ financial future. Being proactive can help minimize a great deal of stress and uncertainty down the road — for your parents, yourself, and your entire family.
The worksheets in this book are included in a download kit so that you may modify them to suit your needs at www.self-counsel.com/updates/financialcare/14forms.htm.
Chapter 1
Preparing to Be a Caregiver
Not long ago, a treasured client of mine, Grace[1], had missed three appointments at our office. She completely forgot about the appointments the first two times they were scheduled. The third time we rescheduled, my associate called to remind her, but she got lost on her way to the office. I booked a fourth meeting, this time at her house.
I was concerned about her, so during our meeting I asked if she would give me permission to call her two daughters, Linda and Mary, and share some information with them. She signed a letter I had brought with me, giving me her permission.
Tellingly, as we had our discussion, she could not recall Mary’s last name or telephone number. I called Linda and requested a joint meeting with her and her sister, and explained (without going into detail) that I had some concerns about her mother’s health.
The meeting went well, and at the end of our discussion outlining my concerns, I suggested two things:
1. Grace needed to update her will and power of attorney.
2. An appointment needed to be made for her to see a gerontologist.
Grace did both. The lawyer’s meeting came first, and they were able to complete the power of attorney and will with her. The gerontologist appointment came later, and confirmed my concerns: Grace was diagnosed with Alzheimer’s disease.
Grace’s story is not unique, and the steps her daughters have had to take since then are becoming more common. Her daughters are part of what we refer to as the “sandwich generation.” Recent trends show kids in their twenties are choosing to stay in the family home longer, leaving Boomers fearing that when they finally have a freshly emptied nest, they will be faced with taking on their own aging parents who will then require full-time care.
Your best years should be from retirement — generally between the ages of 60 to 80, and up to the onset of chronic illness. Yet, according to the Certified Professional Consultant on Aging (CPCA), these are the years where you are most likely to be called on to help with aging parents.
But wait a minute! Aren’t these the “golden years” you’ve been dreaming about? The years of travel and adventure, free from worry? Your children are grown and out of the house, and you get to enjoy the freedom from responsibility for others, right?
Most of us love our parents and have a sense of responsibility for them, so we want to do the right thing when it comes to their care. As Amy Adams’ character said in the movie Trouble with the Curve when her father (played by Clint Eastwood) asked why she was still there trying to help him through his health problems, “I feel this dysfunctional sense of responsibility to make sure that you’re okay.” If, like Amy, you are worried about your aging parents and their ability to care for themselves, this book is for you!
Are you wondering when is the right time to get help for your parents? Are you struggling with what the best time is to move them from home care to a long-term care facility? These are tough questions for any child to answer. I have often teased my own children that I want to get a tattoo with a “best before date” in big, bold letters, clearly instructing them on when it is the right time to place my infirm remains in a nice, warm, comfortable retirement residence at