Making financial decisions takes time, attention and energy at any age. In the case of elderly adults, it may become increasingly difficult to manage finances, particularly if their health is declining or they’re experiencing a cognitive issue. If you’re providing support to aging parents—or plan to in the future—here are some tips on how to handle the situation and prepare for what’s to come.
Don’t wait to start talking about money.
It may be uncomfortable to ask your parents to discuss their finances with you, but it’s essential that you are familiar with their intentions for future care and the plans they have in place. When you broach the subject, emphasize that you are looking for only a high-level overview so that you can have more peace of mind about your parents being well cared for. This initial conversation can help set the groundwork for future discussions.
Create a contact list.
If your parents experience a sudden change in health that affects their ability to manage their affairs, it’s important to have a game plan. If you anticipate paying bills, making insurance claims and handling other financial tasks, ask your parents for a contact list for the professionals they work with and where their accounts are held. You may need to be an authorized user or power of attorney to be allowed access to certain accounts. Consult a lawyer to talk through what permissions may be necessary for you to step in if the need arises.
Build a support network.
Talk with siblings or other trusted family members about what your parent’s possible care plan could look like. While this conversation can be tough to initiate, it’s often easier to bring everyone together while your parents are still in good mental and physical health. Discuss who can realistically provide support: in what way and at what cost. Proactively deciding who can drive your parents to appointments, manage financial affairs, care for their home and handle other tasks can help avoid a strain down the road.
Anticipate future lifestyle changes and challenges.
Even if they aren’t yet needed, explore options and costs at various assisted living and memory care services. Check your parents’ insurance policies to see if and how services might be covered. You may want to explore whether their home or yours could be modified to provide additional space or comforts, such as wheelchair access. Knowing what choices exist and how your parents feel about each one can help you make future decisions with more confidence.
Know your rights at work.
The Federal Family and Medical Leave Act of 1993 (FMLA) allows covered employees up to 12 weeks of unpaid leave to provide care for a family member with a serious health condition. Consult your employer’s human resources department to learn about their policies for employees who are caring for a parent and how to initiate a claim. Many employers have access to resources and support groups to help you manage home and at work duties.
Maintain momentum on your own financial goals.
It’s prudent to look at your finances to see how much support you could provide your parents, if needed, without jeopardizing your retirement and future health care needs. Your financial advisor and lawyer can help you take the steps necessary to feel more confident.
MICHAEL W. K. YEE, CFP,® CFS,® CLTC, CRPC®
1585 Kapiolani Blvd., Ste. 1100, Honolulu, HI 96814
808-952-1240 | michael.w.yee@ampf.com
ameripriseadvisors.com/michael.w.yee
Michael W. K. Yee, CFP®, CFS®, CLTC®, CRPCTM, is a Private Wealth Advisor/
Financial Advisor with Ameriprise Financial Services, LLC in Honolulu, Hawaii.
He specializes in fee-based financial planning and asset management strategies
and has been in practice for 41 years.
1U.S. Department of Labor: The Family and Medical Leave Act of 1993
(https://www.dol.gov/agencies/whd/laws-and-regulations/laws/fmla)
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