What Issues Should I Consider For My Aging Parents?

Reader Question: 

What issues should I consider for my aging parents?

We frequently hear from clients who are concerned about how to support their parents through the various transitions of the aging process. This is a critical issue for many folks who consider themselves to be a part of the “sandwich” generation- those who are caring for both growing children and aging parents at the same time.  As a dual caretaker, we know you have constant demands on your time and energy, so we have provided a consolidated checklist at the end of this article that you can download to help guide you through assessing your own parents’ situation.  Here are some examples of the key issues and questions identified in the checklist to address with your parents as you become more involved in their financial life and care:

Cash Flow & Living Arrangements 

• Do your parents need assistance in managing their bills?  If so, you may want to consider if there is a family member who can step in or if you need to consider an outsourced bill pay service for seniors.
• Is there a plan to deal with a potential illness or reduced mobility?  If so, consider researching who can assist your parents in developing a plan to evaluate these considerations for their current home.

Estate Planning 

• Do your parents have an estate plan including General and Health Care Powers of Attorney and a Living Will?  Is the plan up to date for the key people named and state of residence?  If not, making an appointment with the estate planning attorney should be a top priority.  
• Do you need the contact information for your parents’ professionals (financial advisor, accountant, attorney, doctors)?  If so, be sure to collect this information and see if you can reach out in advance of a crisis to introduce yourself.  
• Do the titles of your parents’ accounts (investment and bank) need to be reviewed or updated?   Consider adding a TOD (transfer on death) to any brokerage accounts, POD (payable on death) to any bank accounts or create a revocable living trust to avoid passing through probate.

Insurance Issues

• Do your parents have LTC (long-term care) insurance, an LTC rider on life insurance, an annuity, or critical illness insurance?  If so, review the benefit triggers for the policy to be prepared for potential future use.

Tax Planning

• Will your parents have any deductible medical expenses this year?  If so, consider strategies to take advantage of large medical deductions such as Roth IRA conversions or capital gains harvesting.

Asset & Debt Issues 

• Are there any assets or accounts that should be consolidated to make access and management easier?  
• Could there be any property, assets or life insurance that need to be managed but have not been identified?  

If the comprehensive checklist feels overwhelming, a good first step is simply to have a conversation with your parents to get their current thoughts and assess their level of preparation.  Here are some potential questions to consider in your conversation:

• Where do you keep your financial and estate-planning documents? What do you own? What do you owe?  
• Can I meet with your various advisors? This will help to alleviate the need to get up to speed in a crisis.  
• Who are your doctors and medical professionals? What prescriptions do you have? Which pharmacy do you use?
• What planning have you done for long-term care? What kind of care do you want if you need help with bathing, dressing, going to the bathroom? Do you want to stay at home? Move closer to family? Move to a retirement community?
• What are your wishes regarding end-of-life care and funeral plans and expenses? If you face a medical crisis, what kind of treatment do you want?

This can be a challenging process, so be sure to set realistic goals for yourself and get outside help where needed.  If you have siblings or other family members who can help share the workload, it is critical to communicate clearly with them when creating a plan for who is handling what so that you are all on the same page.  Caring for aging parents is a journey that demands compassion, understanding and thoughtful planning.  By addressing the key planning areas proactively, you can provide the support and care your parents need to age gracefully and with dignity.  

Liz Alf is the Principal of Clerestory Advisors and fee-only CERTIFIED FINANCIAL PLANNERTMlocated in Minneapolis, MN.  She is a member of the National Association of Personal Financial Advisors (NAPFA) the Fee Only Network and Wealthtender.  She enjoys serving clients with on-going financial planning and investment management services.