Helping an older relative or a parent plan for long-term care and other end-of-life issues is best done when the elders are healthy.
Once stricken, older relatives may be unable to understand questions or express their wishes in proper detail. If there is no plan, family members grasp at responsibilities — or shirk them — without any idea of what the older relative would really want.
Want to avoid a worst-case scenario? Start the conversation now. Here are some ideas:
Start with the most important priorities: Jumping into money issues first is usually a mistake. Deal with immediate health and lifestyle issues first.
Ask questions in advance: Make a list of questions for the elderly relative to answer while they have the capacity to address them. The basics: Where important papers are, how household expenses are paid, who their doctors are, what medicines are being taken and whether there’s a will, healthcare directives and a funeral plan and resources to pay for it. Ask yourself: “What do I need to know if my family member suddenly becomes sick or dies?”
Talk about long-term care insurance: One of the biggest misconceptions about long-term care is that Medicare pays for it. It does not pay for the actual cost of home-based or nursing home care. In 2009, private room nursing home care averaged more than $60,000 a year. Long-term care insurance is more affordable when purchased before Age 60. If an elder cannot afford top-quality care, families should plan alternatives sooner than later.
Be patient: Having a successful financial discussion could take several attempts. Say something like, “You’ve always been so independent, Mom. I just want you to give us the right instructions so we do exactly what you want.”
Get qualified advice: A qualified adviser can help you straighten out the family finances, put specific legal documents in place, and set up ways to pay bills if your relative is unable to do so. If possible, involve your elder in that conversation. An elder should have a current will and healthcare powers of attorney documents in place. Creating or reviewing those documents is a good starting point for other planning.
Plan a caregiving strategy together: Discuss the relative’s preferences and trigger points for various stages of health care. Have an honest discussion about how much can be done at home with a caregiver and when various services (home health aide, geriatric care manager, assisted living) should begin. Put that plan in writing, as it will save plenty of doubt later.
Discuss what happens with the home: If an elderly relative becomes irreversibly incapacitated, the equity in the home may be a source to pay for medical or household maintenance. Since the home is both a financial and “emotional” asset, get good advice and spell out specifically what the elderly relative wants done with his property and under what conditions.
Make sure everyone knows the plan: Once you settle on a strategy, make sure all involved understand the plan and their respective assignments.
Karin Grablin, a financial planner with Dictor & Martin, Two N. Tamiami Trail, Sarasota, can be reached at (941) 906-7222.