Planning for aging parents can be an incredibly difficult topic to approach. Not only because it includes financial aspects, but it can also be a sensitive subject to acknowledge that you or your parents are getting older. It’s important to have a plan to address various topics ahead of time as it will reduce the amount of stress an executor or power of attorney has during an emotionally difficult time.

Here is a small list of the most important topics to discuss and plan for yourself or your parents.

1. Health and medical care: As parents age, they may require more frequent medical care and attention. It is important for children to stay informed about their parents' health conditions, medications, and any medical procedures or treatments they may require.

If there are hereditary illnesses in your family that you may need to consider for yourself or your spouse. This may be an opportunity to create a plan to address these illnesses during the accumulation phase of your financial plan.

2. Safety and well-being: Children should ensure that their aging parents are living in a safe and comfortable environment. This may include making necessary modifications to the home, such as installing grab bars, non-slip flooring, and other safety features.

Statistics suggest that a substantial number of the aging demographic will rely on their children for support during a long-term care event. According to a study done by AARP & The National Alliance for Caregiving1, more than 50% of caregiving the US report caring for a parent.

3. Financial and legal planning: Children should consider helping their aging parents with financial and legal planning, such as estate planning, creating a will, assigning beneficiaries, and setting up a durable power of attorney for healthcare and finances.

Even households with “simple” finances can create hurdles for children who act as executors of their parents’ estate if no planning was done prior to passing. If your parents work with a financial planner, you may consider making introductions with one another to stay informed as to what, if any, responsibilities you may need to plan for.

4. Emotional and social support: As parents age, they may experience feelings of isolation and loneliness. Children should make sure to stay in touch regularly by visiting, calling, FaceTiming, and helping their parents stay connected to their social networks. This tends to be the least addressed topic when planning for retirement and aging parents.

5. Long-term care planning: Children should consider discussing long-term care options with their aging parents, such as assisted living or in-home care. It is important to have a plan in place for how to handle any future care needs that may arise. That plan may or may not include long-term care insurance, depending on the family’s asset levels and care goals.

A recent study by Transamerica2 showed that that 40.7% of caregivers never financially planned to become one prior to obtaining the responsibility of caring for a parent experiencing a long-term care event.

Sources:

1AARP. (2020, May). Caregiving in the U.S. National Alliance for Caregiving. Retrieved April 1, 2023, from https://www.caregiving.org/wp-content/uploads/2020/05/Full-Report-Caregiving-in-the-United-States-2020.pdf

2A Millennial Perspective on Caregiving. (2023, March 22). Transamerica. https://www.transamerica.com/knowledge-place/millennial-perspective-caregiving

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