What if you woke up one day and twelve years had passed? While you might wonder how you grew a waist-length beard or hair, a significant part of your life disappeared. How did this happen? Last you knew, you were on track for a promising career, you were exercising (periodically), and were planning all sorts of travel, family, and life – then, your parent fell ill. As the geographically closest child, the primary responsibility for caregiving fell to you. Although your siblings offered to help, they lived too far away to provide meaningful day-to-day assistance. You never planned to put your life on hold, but . . .
This story happens every day to different people across the United States. As the baby boomer generation ages, more Gen-X, and even Millennials will be faced with the challenge of continuing their lives and careers with the competing need to care for their loved ones. In my own extended family, I have watched a few cousins give up a good portion of their adult lives being the primary caregiver. No one can truly be prepared for the emotional and mental challenges that come along with becoming a caregiver. But, we can take steps to plan for our financial and professional future that will help to lessen some of the impact.
Dealing with the financial stressors of caring for an aging loved one can affect your ability to provide them with the care and compassion they need. It can also put the security of your financial future at risk. To mitigate these concerns, consider these useful tips to help you make informed decisions about how to protect your future retirement plans while caring for your senior loved one.
Don’t Leave Your Job
Many adult children end up putting their professional lives on hold to become a primary caregiver for their elderly parents. Financial experts advise against this because of the sudden loss of income and valuable benefits. Consider caregiving options that support your ability to maintain your earning potential.
Many professions today allow for remote access and flexible schedules. Speaking to your employer about the situation may lead to new options, which could even result in greater productivity – Win-Win! For adults who work in shift professions, employers may still be able to reschedule or even create new schedules for employees who need to devote time to caring for their family.
Sometimes, creative discussions can lead to promising opportunities. Rethinking how your job and life interact may show different ways of solving the time problem. By doing more than just stating a conflict might exist, you should approach this issue with at least possible solution. Your boss and your family will thank you for it.
Create a Budget
Review the actual costs of being a primary caregiver before making any drastic changes like leaving your job. Also, consider whether your loved one’s assets can be utilized to cover some of the costs involved in providing care inside or outside the home. Planning, planning, and more planning. The cost of living in South Florida varies widely depending on the neighborhood, the city, and if you live east or west of particular streets or highways. Becoming a caregiver can double your expenses and halve your income. Be careful!
Costs can be direct and indirect. When creating the budget, be sure to carefully examine expenses. For example, you might decide to spend the evening hours with your mother, who needs care. During that time, you help her with dinner, a bath, maybe some physical therapy, or just listening. You help her into bed and wait for at least an hour until you’re sure she’s peacefully sleeping. Now, it’s close to 10pm and the home health care aide arrives to cover the overnight. What indirect costs did you just incur?
- What did you do about dinner? Most people won’t go home and cook a healthy dinner. Instead, they will opt for drive-thru or something similarly less than healthy. Your own health care or health maintenance (gym) costs could increase in the future?
- When do you have time for you? What projects were you working on before becoming caregiver? The extra hour you had been devoting to professional development is burned. How will you continue your career if you’re not staying on par with, or ahead of your peers? You could be costing yourself future income.
- What about your family? Several years ago, my wife’s grandmother became terminally ill. She went into the hospital for treatment and left almost thirty days later for home hospice. The strain on the family was substantial. Both my wife and I would go to the hospital after we finished work. We would finally get home at around 10pm on weeknights. On the weekends, we would spend most of the day and a good portion of the night. Did I mention we had a four year old at home? Of course, she was well-cared for, but she missed out on our parenting and companionship during that time. This is one situation where caring for an elderly family member may result in a zero-sum situation with your younger family members.
Look for Benefits Elsewhere
Free or low-cost benefits that can help cover some of the costs of caregiving, such as home health aides, are often available to seniors. Similarly, review the limitations of public benefit options such as Medicare and Medicaid. Additionally, local governments often have programs that can be of assistance. One of the better place to search for programs is in the private sector. Many charities, religious organizations, and affiliate or special-interest type organizations (e.g. veterans, unions, and the like) have free services available through community volunteers. There is no cost to doing Internet searches to see what turns up in the local area.
Consider Relocating Your Parent
It is common for seniors to prioritize remaining in their own home while they age. Although understandable, this can be a very expensive, and often unrealistic option. If opening your home to your loved one is an option, it can be far less expensive.
Location is one thing that can contribute to higher direct costs. For example, the additional gas and parking expenses will deplete cash-on-hand in increments of $20 – $50 per week. Standing alone this is not significant, but when totaled over the course of weeks, the impact can be substantial.
Financial costs are not the only part of this analysis. For many seniors, especially those who are physically and mentally capable, staying in their own home is a source of self-worth and pride. Alternatively, finding an apartment or assisted living facility near your home can possibly serve as a location that makes life easier on your while still preserving the elder’s independence. We must remember that our elders lived a lifetime independently. Coming to terms with needing help is not the easiest task.
Seek Professional Help
Geriatric care managers can help you establish a caregiving plan that meets your needs and assist you in identifying resources to save time and money. Community organizations are also available to give pointers and make recommendations. When in doubt, there’s always the Internet. Remember, you are not the first person to go through this process.
Protect Your Parent From Scams
Financial elder abuse is on the rise, so make sure your loved one’s finances are protected. Telephone, postal mail, and Internet fraud is common and can be easily avoided when a close relative or friend is keeping tabs on the accounts of a senior loved one. Consider talking with your parents about stepping down as trustee of their trusts and letting you step in now to monitor their finances, and if they do not have a trust holding title to their accounts, meet with us now to look at whether it makes sense to set that up for them (and for you).
Along with the sunshine, beaches, and nightlife, South Florida is ground zero for identity fraud. There are many active criminal organizations that work through computer networks to obtain credit card and social security numbers to get illegal access to bank and credit accounts. These thieves have accessed hospital networks, payment processors, retailers, and almost every other type of electronic record. Indeed, the conventional wisdom in this industry is that it is only a matter of time before someone’s accounts get hacked or their identity is stolen. Being proactive is only part of the security solution. When you decide to work on protecting your elders from these types of scams, you need to be even more thorough.
Passwords and tax returns are two specific items that require some further thought. Common passwords include “password,” “123456,” and “qwerty.” Some folks think they are being sly with “zxcvbnm,” or “918273645,” but the bots that hack passwords test different possibilities millions of time per second, if not faster. Creating a secure password for you may not be the secure password for the person in your care, especially if you are working to maintain their independence. Nevertheless, getting input from that person is empowering, especially when you calmly address the risks of not taking action.
Fraudulent tax returns have been on the rise for several years. In the not too distant past, the IRS specifically identified Miami and Fort Lauderdale as two of the top areas of the United States for the theft of tax returns. As a caregiver, you should ensure that your elder’s tax return is either promptly filed or that an extension is obtained. Communication with the IRS is important. This problem can be avoided with proper planning.
Discuss the Future
Now is an opportune time to review your loved one’s wishes for his or her estate and consider your own financial goals and how helping to care for a loved one might affect them. There is no better time than the present to review the documents in your elder’s possession. Ensuring paperwork is in order will reduce anxiety and bureaucracy. The last thing either you or the elder in your care need is for unnecessary delays because a signature was missing.
Caring for a loved one can take a toll, both financially and emotionally. If you are ready to create a financial plan for caregiving, start by sitting down with a Personal Family Lawyer®. A Personal Family Lawyer® can help you plan for changes in life at every stage. The Family Wealth Planning Session guides you to protect and preserve what matters most. Before the session, you’ll receive a Family Wealth Inventory and Assessment to complete that will get you thinking about what you own, what’s most important to you, and what you can do to ensure your family is taken care of.