Becoming a caregiver for aging parents can be a drain emotionally and can carry financial ramifications both for parents and for the caregiver children. Understanding and managing the financial issues involved can make the situation a bit easier all.
In this checklist, we cover a number of financial issues that you need to consider when faced with helping and potentially caring for aging parents, including:
- Be sure you examine your parents’ finances to determine if they are able to manage their own expenses. There may be sources of income available to your parents of which the parents are unaware.
- It’s important that you have access to your parents’ important documents such as any estate planning documents. You should have the names and contact information for any advisors your parents use such as an attorney, financial advisor or accountant.
- If your parents need long-term care, you will need to investigate ways to cover the cost. Medicaid planning or a reverse mortgage might be options.
- If the estate of your parents is over a certain amount, then you may have an estate tax issue. It’s also important for you to ensure that your parents’ beneficiary designations on insurance policies and retirement plans are up to date, and that they reflect their wishes.
- It’s important for you to ensure that your parents’ tax situation is in order, managing any capital gains or losses, as well as fully utilizing any deductible medical expenses.
- Overall, it’s helpful to have a handle on all of your parents’ assets, liabilities and all related financial issues as a time may come when your parents are unable to manage their own affairs.
This is a comprehensive checklist of the types of financial issues that you should be discussing with your advisor when dealing with aging parents.