caring for elderly parents
Navigating Your Parent's Financial Future
So you have a mother in her 70s, who is in pretty good physical health even though she cannot live on her own anymore. Medicaid only kicks in when the person meets criteria such as:
- High-level memory loss and help needed with medicines
- Help putting on clothes and taking a bath, and
- Personal finances spent down to around $1,500.
That's not your mom.
If moving in with you is not possible then assisted living is probably her best option. But assisted living can get expensive, perhaps as high as $3,000 per month. That may be difficult to think about, especially if her financial health is more uncertain than her physical health, meaning that she may have 10 or 15 good years remaining. Social Security will help with some of that but not all. What are your options if you want to avoid decimating personal resources?
First, consider a durable power of attorney. If she is amenable to this arrangement it will make life simpler as you manage her long-term finances. It puts you in charge of her assets and liabilities.
If you've decided on assisted living, look around. Prices do vary. Even within an assisted-living facility, the rent differs depending on type of apartment. A place with full kitchen will definitely cost more than a simple studio — a one-bedroom suite with private bath. Discuss the various options with her.
Assisted living simplifies the spending situation for mom, since life's two biggest expenses, food and housing, now becomes one bill. Take whatever she is receiving from Social Security and subtract that from the assisted living cost.
So let's say you still need $1,000 a month for rent after Social Security is taken out. It is now time to examine her assets. What does she have in CDs, IRAs, checking, savings and other investments? Is there a home that might be sold? Include the potential income from the sale, although you should try to underestimate the amount you would receive.
Rather than spending down assets, you might want to meet with a financial planning expert to discuss ways of making assets work harder. If you don't know a planner, call your bank. They will have someone on staff who can help you.
You may consider purchasing a high-interest, long-term CD or annuity if there is money that she may not need for some time. Right now, $50,000 put into a 4.5 percent interest CD will produce nearly $200 in interest income a month; $100,000 will generate almost $400 a month. Ask the bank if they can write a check to the assisted-living facility in the amount of the interest income each month.
It may finally reach that point where the only recourse is to use your personal finances to help Mom. You may want to consider the option of investing in a CD, annuity or some other financial vehicle that will produce interest income to offset assisted-living costs. That way your principal is still protected while at the same time you are able to help her meet expenses.
But before you make any far-reaching decisions, talk to anyone with experience and expertise. Navigating the oceans of long-term care can become difficult. Better to have a few experienced navigators on board as you chart your course.
Background Information
Hospice: Offering Quality of Life to the End of Life
Approximately 30 years ago, a U.S. volunteer movement began that would revolutionize health care.
Advance Medical Directives
This comparison between Living Wills versus Durable Power of Attorney can help you make informed health care decisions for your aging parent.
Aging or Alzheimer's
Regular signs of growing older often get paralleled with Alzheimer's. Find out the difference.
Caregiving Support Systems
Providing for an aging parent can be stressful. It's important to be surrounded by others who can help.
Help From Hospice
For terminally ill patients, hospice is often a welcomed care option.
Questions and Answers
How can we show concern and respect for the elderly?
Answer
Review Frequently Asked Questions
Stories
Making My Mother's End-of-Life Decision
If Mom lived, would she want to be a "vegetable" the rest of her life? What if she never came out of her coma? What would she want us to end her life?
Full Circle
From child to parent, one woman reflects on caring for her mother.
The Long Goodbye
A daughter faces the harsh reality of her mother's Alzheimer's disease and the difficulty of loving the stranger her mother has become.
You Can Go Home Again
As parents reach their later years, many children feel the tug to move closer to them.
If you've been through a experience related to this topic, we invite you to share your story with others.Share Your Story
Other Things to Consider
Loneliness and Depression Afflicting the Elderly
If you know an elderly person who you suspect is clinically depressed, don't brush it off. Do whatever is necessary to get them the help they need.
If I End Up Like Terri: An Open Letter to My Wife
Teri Schiavo's tragic death made many people think. One man reflected on his future with his wife
Where is God in the Midst of All My Troubles?
So many cry out to Him in times of need, but is God really listening? And, more important, does He care?
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