Personal financeManaging Aging Parents
Planning for Aging Parents
by Jason ValaVanis, CFP
As a financial planner dedicated to helping the senior investor, I get to witness; firsthand, the aging process and how parents and their children struggle with this inevitability. If us baby boomers ignore what we know will happen, it could spell for a series of disasters. You must get ready, seek qualified advice, ask the right questions, take the necessary steps, and emotionally get prepared. Here are just a few ideas that can get you headed in the right direction. If you are an aging parent and your children are sitting on their hands, cut out this article and mail it to them anonymously.
Have a Board Meeting
*So gather your siblings, set a date and consider reviewing the following with your parents. Get those documents in order.
Every living adult needs five critical documents, mom and dad included. The professionals call these documents the “Advance Directives”. They are; the Last Will and Testament, Power-of-Attorney Appointment, Healthcare Surrogate Appointment, Pre-need Guardian Appointment, and the Living Will. As well, I will often recommend a sixth, The Living Trust, which will help to create a probate-free estate. This “six-pack” of documents can cost upwards of $2,000, but I know of a few attorneys that will put this together for less than $300. If your parent has a complex estate or has plans to spread funds to many entities with certain conditions, then more time and dollars will be spent on these documents.
Choose a boss
If you are an only child, skip this step. It is especially important that you and your siblings agree how mom or dad is to be managed, and of course who will do it. Making decisions together is always the best choice, but of course, one day you will be at an impasse. So it is best to have someone in charge that holds the Trump card. This special someone usually will act as your parent’s designated hitter in all of the documents mentioned above. Some families like to have co-bosses. I don’t like this idea, but it is better than no bosses. Availability and reliability are the key concerns. Who wants to be Power-of-Attorney and be 2000 miles away? So, be smart and be practical. If no one is available for the job, then look to a trusted friend, attorney, or other professional. There even exist well-monitored organizations that will step in and handle all of the duties.
Gather and secure all records.
To be prepared for future emergencies, it’s important that a family member knows where your parents store important documents, such as the “six-pack” mentioned above, birth and marriage certificates, Social Security cards, military records and financial documents. In your discussions with parents, you should suggest that they prepare a list of assets and liabilities and let a family member know where this and various financial documents can be found as well. It is also wise to secure names and contact information for your parents’ CPA, lawyer, financial consultant and any other advisors, such as the banker and preacher.
Get adequate insurance.
*Now, at her age and condition, she would never qualify. Don’t forget life insurance. Most final expense bills range from $3,000 to over $15,000. Finding an inexpensive life insurance policy is not that tough. Even, if your dad is uninsurable, most life insurance agents can get what is called graded benefit life. This is a permanent policy that kicks in a full death benefit after two years or so, otherwise the death benefit is a return of premium plus interest.
Choosing Housing
*“The last four years”, Ken said, “was the most difficult period of my entire life!” I recently moved my 79-year old father into my house. He has no long-term care insurance and he is amazingly agile and healthy. Every morning he finishes the newspaper’s crossword puzzle in 15 minutes or less. His income is plenty to pay for home-health care, if needed. And if he needs more, I’ll fund it. But, most children don’t have it easy like I do. So, planning for housing is one of the best moves you can do now – before it is a dilemma.
Activity, Activity, Activity
I believe the quality of life is measured by the “content of life”. What does that mean? If your mom sits home all day watching TV, and sleeps until noon, then repeats this every single day for years, what will be the result? If you are able, get your parents out into the world and schedule fun things to do. Encourage them to travel, go to the movies, see plays, join organizations, and meet other seniors. I have seen this work from the front row. My senior clients that live life to the fullest, live longer, live healthier, and live happier. They are certainly more independent and less likely to ever need prolonged, day-to-day, and tedious care.
One thing we all have in common, is mortality (even our parents). Every single living soul on this planet shares the same grandfather clock. And we all hope, of course, that when the “dong” of the bell strikes at midnight, it is not our time to go. Possibly, with a little insight, foresight, and hindsight, we can figure a way to tinker with the pendulum and maybe, just maybe, we can buy a little more time.
Jason ValaVanis is a Board Certified Financial Plannerâ and the owner and director of Seniors Only Financial and ValaVanis Financial, in downtown Melbourne. Jason can be reached at 321-956-7072.