Financial Tips When Caring for Elderly Parents

Today, managing both your career and family can be challenging. But it’s becoming even more difficult for a growing segment of the population. Commonly known as the “sandwich generation,” these individuals are raising their own children while also caring for elderly parents. 

Not surprisingly, this group faces tremendous stress as their time and energy are constantly pulled in multiple directions. Whether you’re already in this group or feel you might be in the near future, there are steps you can take to ease the challenges.

Steps When Caring for Parents

It’s never easy to experience the slowing of a parent’s mental or physical health. However, stepping up to help is a gesture most adult children are happy to perform. Before jumping right in, review the following steps to ensure you can provide the best care for your parents. 

1.     Get Organized

When taking on the finances of another individual, it can be a lot to handle. They probably don’t have records and accounts set up the same way as you do, which can be confusing initially. Your first step should be to get everything organized. Items you’ll want to locate will include:

• Financial Accounts: Where does your parent have their Savings Account(s) and Checking Account(s)? 

• Outstanding Loans: Are there any loans in your parent’s name, such as a mortgage, credit card, or car loan?

• Assets: Is their house paid off? If so, do they have documentation readily available? 

• Investment Accounts: Find where they have their money invested. Do they use a financial advisor? If so, that will be a tremendous help.

• Incomes: How much money do they have coming in each month? Is this money from investments, a pension, or social security? 

• Bills & Expenses: Make a list of all their current bills and living expenses. If you’re unsure of all their recurring expenses, collect all bills in the mail for a month or two and review all financial and credit card statements. Identifying all regular expenses is usually one of the hardest steps since some costs may only occur quarterly, semi-annually, or annually. 

2.     Obtain Legal Documents

The biggest hurdle you will face when navigating your parent’s finances will be legal. Most financial institutions (and healthcare providers) will not allow you to make decisions for your parents without a Power of Attorney (POA). To obtain a POA, you can either visit a local attorney or use the services of an online legal company. 

It’s also wise to ensure your parent’s will is up to date. If their mental health is a concern, this step should be completed as soon as possible to guarantee their final wishes are documented. 

3.     Discuss Future Plans

Once you have your parent’s affairs in order, it’s important to sit down and discuss their future wants and needs. Do they want to remain in their home as long as possible? Are they open to downsizing and moving to a smaller home or a 55+ community? 

As healthcare costs and prices at assisted living facilities continue to climb, it’s crucial to have a plan in place that is aligned with their financial capabilities. 

Understanding Your Role as Caregiver

Most adult children wouldn’t think twice about jumping in to help an aging parent. While it’s admirable, it can often wear down the caregiver – both mentally and physically – especially if you’re raising your own children simultaneously. 

As a caregiver, it’s essential that you also take care of yourself and know when it’s time to ask for help. Here are some tips to keep the experience as a caregiver positive for you and your parents.

1.     Document Everything

While your intentions are only to do what’s best for your parents, keeping accurate records is crucial. This is especially important when it comes to their financial affairs. Unfortunately, family disagreements can and often do arise. You want to ensure you’re protected while caring for your parent and after their passing.

2.     Keep Your Finances Separate

Do your best to separate your finances from your parent’s. Building off part one, you want to be able to keep accurate records of everything you do on their behalf. If you begin to cover your parent’s expenses as a nice gesture, it could lead to financial challenges for you and your family.

3.     Pay Attention to Your Needs

Caring for both your family and your aging parent can be exhausting. Between managing their finances and doctors’ appointments, it’s easy to become stressed. Know when you’re pushing yourself too hard. It’s essential to take time for yourself and recharge. Don’t feel guilty about taking some “me time” to relax and recoup. 

4.     Ask for Help

If you live near your parents and your siblings do not, most responsibilities will likely fall into your lap. Before you let this happen, it’s important to discuss the situation and assign roles to each sibling. If that doesn’t help, or you’re an only child, don’t be afraid to ask others for help. Whether hiring a professional caregiver, nurse, or financial planner, people are willing and able to assist you.

Takeaway

Being part of the “sandwich generation” is no easy task. Most adults in this category are in the peak years of their careers and earning potential while also raising their own families. Their responsibilities and stress are already high - the need to step in and help an aging parent can be quite challenging. 

While you will likely do anything for your parents, it’s essential to understand your role as a caregiver. Make sure you’re organized, have a plan for the future, and seek help as needed. You want to ensure the experience is positive for both you and your parents.

If you believe you will be responsible for your parent’s financial affairs in the near future, we’re ready to help. Our team is here to answer all your questions and walk you through what you will need to legally manage your parent’s accounts. Please stop by any of our convenient branch locations or call 248-322-9800 extension 5 for assistance today.

 

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