Lisa Stickler 2016-01-21 15:20:46
Fifty percent of West Michigan Woman readers have questions relating to assisting aging parents. According to FindLaw, “One in four adults is primarily responsible for caring for their elderly parent, and the number is expected to increase in the future.” Some relatives have planned for their retirement years; others have not. If your aging parents have no plan plan, one must be created. Primary topics to address concern legal, financial and lifestyle decisions. Approaching these important conversations may be difficult. Elizabeth Harrell, president and owner of Crossroads Eldercare Planning, which helps families determine options available to their aging loved ones, suggests you begin by engaging your parents in a general, relaxed discussion. Explain that while you are trying to help, they’re still the ultimate decision makers. Harrell recommends asking questions such as, “How do you see your future?” “What are your concerns?” “Where do you hope to live, and why?” Crossroads Eldercare Planning and similar companies educate families on their seniors’ housing options and bring various senior resources to their attention. They may also employ people who specialize in the clinical, financial and legal aspects of eldercare planning. Harrell never wants families she works with to say, “If only I had known ...” Sensitive matters are easier to discuss before a problem arises. Yet more often than not, Harrell is contacted when an elderly parent has been hospitalized or has experienced a frightening episode related to aging. While those who’ve already begun this process know it runs counter to the traditional parent-child paradigm, help that comes from a place of compassion is generally welcomed and appreciated. LEGAL The estate planning field is vast and nuanced. A knowledgeable attorney could help you and your parents discuss will and trust documents and establish important powers of attorney. Wills and Trusts Your parents’ specific circumstances dictate which estate planning tool will be most beneficial. If they haven’t created their estate plan, you must initiate this process. Laurie Murphy, an estate planning attorney at Miller Johnson, explains the differences between a will and a trust as: “A will is an instruction manual for the probate court, whereas a trust is an instruction manual for the trustee.” While a will provides its creator (testator) with little control over the management of its assets, a trust offers extensive control. An additional benefit offered by a trust is that it circumvents the probate process, which can be long and costly. Katie Aguilar, also an estate planning attorney at Miller Johnson, reminds her clients that a trust is only useful once funded; in other words, the assets it contains must be titled to the trust. Helping your parents devise their estate plan is an integral aspect of planning for their aging process. (See more about this topic on page 32.) Power of Attorney Wording determines a power of attorney’s reach. Harrell reminds clients that a simplistic, generic power of attorney will be of little assistance. For assisting aging parents, Aguilar notes, it’s important that your powers of attorney are made “durable.” A durable power does not terminate upon the mental incapacity of the principal. Aguilar described the importance of two documents: Designation of Patient Advocate and a power of attorney over financial decisions. Designation of Patient Advocate gives the agent power over the principal’s health care-related matters; this durable power becomes effective upon the principal’s mental incapacity. Power of attorney over your parents’ financial decisions is made durable by the inclusion of specific statutory language regarding mental incapacity. “Not all powers of attorney are created equal,” Aguilar said. “You must read through the documents and ensure that the necessary powers have been granted.” Living Will One area of difficulty concerns living wills. In Michigan, a living will expresses a person’s medical care wishes and can direct signing of a Do Not Resuscitate (DNR) order; this is not in and of itself a DNR order. A DNR order is a standalone document. An individual with a health care power of attorney is authorized to sign a DNR on behalf of the principal. Accuracy of these intricate matters is exceedingly important and best handled with a knowledgeable estate planning attorney’s assistance. FINANCIAL Your loved one’s financial situation touches all aspects of the aging process. Conversations regarding your parents’ financial preparedness are often uncomfortable, but cannot be avoided. To diffuse this emotionally charged topic, Melissa Stewart, CFP® Financial Advisor at Blueway Financial Partners of Raymond James & Associates, suggests inclusion of a neutral third party, such as a financial planner, CPA or estate attorney. If your parents aren’t comfortable handing this information to you directly, it can be provided to that third party. The establishment of a durable power of attorney regarding your parents’ finances ensures your receipt of this information upon the occasion of their mental incapacity. Financial Information The list of financial information your parents must provide is long, and the subject matter sensitive. An accurate account includes awareness of their income, expenses, assets, debts and insurance coverage. To this end, Stewart requests bank account numbers; safety deposit box information; life, health and disability insurance policy documentation; loan and liability information; stock portfolios and pension plan documentation. Aguilar, from Miller Johnson, also notes the importance of determining whether insurance policy beneficiary designations have been made. According to PBS.org, pension plans—particularly the plan’s payout options—should be part of any financial conversation with aging parents who have not yet retired. These plans can be paid in a lump sum or an annuity, and are often a significant source of income. Careful financial planning also includes exploring your parents’ lifestyle preferences. If they choose to age in-home, you must determine the financial feasibility of that wish. It’s also important to research long-term care insurance policies, as Medicare and general insurance plans don’t cover assisted living expenses. Purchasing a long-term care policy could lessen your parents’ financial burden. “It is important for us to have a fairly strong understanding of a person’s financial standing when they are working with us in their search for senior housing and home care,” said Harrell, from Crossroads Eldercare Planning, “so a decision isn’t made that becomes unaffordable in the long term.” Stewart emphasizes that the management of your parents’ finances is not formulaic. One common theme, however, applies: Acquiring a thorough understanding of your parents’ financial status is of paramount importance. Retirement When addressing your parents’ finances, don’t overlook your own retirement savings plan. A survey conducted by Bankrate.com showed that 26 percent of people between the ages of 50 and 54 have no retirement savings. Kelly DeRidder, Vice President, Trust Advisor Wealth Management at Comerica Bank, encourages clients to “create a financial plan, mapping out their short-, intermediate- and long-term goals for retirement.” This plan should account for items such as future medial expenses, assisted living costs and taxes. DeRidder recommends contributing the maximum allowable amount to 401(k) and other sponsored retirement plans. To self-employed clients or clients whose employers don’t offer a retirement plan, she suggests contributing the maximum allowable amount to an SEP or a regular or Roth IRA. She also advises utilizing pretax reimbursement programs. The prospect of retirement is less daunting for the financially secure. DeRidder stresses the importance of establishing a positive cash flow prior to retirement by managing your debt and living within your means. As you age, you’ll reap the benefits of setting and adhering to long-term financial goals. It’s never too late to start saving for retirement—but the sooner, the better! LIFESTYLE Our sense of self is tied strongly to our independence level. Your aging parents’ lifestyle options are varied, among them aging in-home, moving to an independent living apartment or residing in an assisted living community. In-Home Care If your parents choose to age in-home, they’ll likely require the assistance of a caregiver. Theresa Wilson, Home Care Manager at Diversified Medial Staffing, notes that statistics demonstrate seniors fear the loss of independence more than they fear death. An in-home caregiver could help an aging parent reclaim a sense of independence by helping with tasks such as dressing, bathing, laundry, meal preparation, running errands and providing transportation to doctor’s appointments. Many companies also address the needs of aging parents who require more physical in-home care. According to Meghan Laux, Vice President of Business Development at Heather Hills Retirement Village, in-home services could also include skilled nursing, physical therapy, occupational therapy and speech therapy. Wilson emphasizes the emotional benefits caregivers provide. Caregivers and their clients might capture memories by creating journals and photo albums, watching sports together, or even traveling together. “The friendships that develop between seniors and their caregivers are amazing,” Wilson said. In-Home Modifications Many seniors who prefer to age in-home could have a difficult time navigating their current space. In these situations, home design modifications could be tremendously helpful. Interior Designer Kathy Barry, with Home Life Interiors, works with clients to address their specific age-related needs. Barry said modifications provide a beautiful, yet safe living environment for these individuals. In-home modifications take into account such aliments as arthritis, weakness, impaired mobility and changing eyesight. Replacing round doorknobs with levers assists arthritic clients; installing smooth flooring helps clients with wheelchairs or walkers, or whose gait has been altered; creating an aesthetically pleasing contrast between kitchen counters and floors helps clients with diminishing eyesight. To avoid expensive after-the-fact alterations, Barry urges younger clients constructing new homes to plan for their aging process. Widened hallways and doorways will accommodate a future wheelchair or walker, and opting to install a ground-floor master suite expands in-home aging opportunities. Care Facilities While your parents may prefer to age in-home, those who do so could become introverted notes Melissa Satterfield, Director of Operations at Heritage Property Management, Inc. In fact, many Heritage Senior Communities residents have told her they wish they’d chosen a care facility sooner, because of the “carefree lifestyle” such places provide. Laux, from Heather Hills, realizes many family members experience guilt when moving their parents out of their homes. She reminds these individuals, however, of the important sense of community established among care facility residents. Some care facilities offer separate independent and assisted living options; others utilize the “age-in-place” structure. Residents of an age-in-place facility stay in their own unit, Laux said, regardless of the level of care they require. Before your parent becomes a resident of an assisted living facility or converts to the receipt of an assisted living level of care, some communities—such as Heather Hills Retirement Village—will conduct a needs assessment and will continuously update this assessment as care requirements change. A resident’s comfort is of utmost importance. Satterfield said communities such as Heritage may encourage assisted living residents to bring furniture from home to create a more comfortable, familiar living arrangement. She and Stewart both emphasize the benefit of talking about care facilities with your parents before the need for these establishments arises. Assisting your aging parents is difficult and emotionally trying. We often place our needs on the back burner when assisting others. Stewart reminds her clients to care for themselves when aiding their parents. And don’t forget to keep your own retirement plan in mind: your future caregivers will be extremely appreciative! DISCLOSURE: Certified Financial Planner Board of Standards Inc. owns the certification marks CFP®, CERTIFIED FINANCIAL PLANNER™ and federally registered CFP (with flame design) in the U.S. Raymond James & Associates, Inc., member NYSE/SIPC.
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