In my daily consultations with seniors, I hear many stories. Some are happy recollections of a full life, wonderful children, active retirement, and plans for a successful retirement. It warms my heart to see the faces of my clients light up as they mention their children, their successes,, and the sacrifices my clients made to ensure their children's success. Other times the stories are quite different, and the expressions on the faces can be quite sullen.
Consider the story of Mary and Bill (names have been changed). Now in their late seventies, they are facing some dire times in their health and their finances. Mom has been slowing down because of the early stages of Alzhiemers. Dad had a knee replacement recently, and has to be careful of how he walks and lifts. Children they raised and supported well into their adult lives have forgotten them, except for the occasional holiday greeting and "how are you". The children live only miles away, but their own situation has them preoccupied. Having several teenagers and some down-sizing at their jobs, they do not have the time nor the resources to take care of mom and dad. This a common plight of the sandwich generation. I empathize with them, as my wife and I experienced this first-hand, with three kids in college, and my father-in-law suffering from Parkinson's disease (he passed two years ago). I recall the conversations my wife and I had, and the "lively" discussions over finances and schedules.
The collateral "damage" is often overlooked when taking care of our elderly parents. Lack of funds and lack of planning create intense situations, and often lead to emotional decisions. I strongly recommend starting the conversation early with your family. The top three issues you will be facing are money; housing and locating documents, in that priority. When you run out of money, you run out of options. Too often I hear clients tell me that "our eldest daughter will care for us", yet they have never brought the subject up with her. You can't assume anything. Reviewing insurance, assets, power of attorneys, trusts, wills - all are a must. Too often I witness people who needed to have these important documents in place, yet suddenly they lack the mental capacity to sign documents. Reports show that 1 in 4 retirees may be stricken with Alzheimer's. Six in ten will require some form of nursing care. Educating oneself about the costs of care and options available will help creating a quality of life budget, and will save many hours of arguing, guilt and stress, not to mention money.
With nursing home costs exceeding $7000 a month per person, it may be more cost effective to care for parents at home. From my consultations with home health care providers (here in the Midwest), full-time care can run $300 a day, but that could be for two clients. It may also be more convenient for the family. It may also be a safer environment, and certainly a more familiar setting.
When considering caring for the elderly in their homes, tapping into that home equity can be a way to fund that care. Here is a where a reverse mortgage can be beneficial, as proceeds are tax-free and do not affect Medicare, and there are no monthly payments. Creating a team - a geriatric care manager and a financial planner or elder law attorney - can maximize the use of the resources assets available.
I share this information because I consult with clients that much too often wait for the emergency to happen - an illness, an accident, a death - and then the options start to dwindle. Please contact me, Florian Steciuch, for more information. I would be glad to recommend several top professionals in the home health care, elder law, estate planning and financial planning fields.
Visit http://www.topflitereverse.com/florian for more information on reverse mortgages and to see what you can qualify for.
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