Whether it’s due to unexpected circumstances or old age, it’s likely that you or a spouse will become a caregiver for a loved one at some point in the future. You may already be a caregiver, and if so, you already know how overwhelming and emotional this time can feel. Caregiving requires love, time, patience – and of course, financial support. The financial side of caregiving can be especially taxing. Here are 11 tips to help manage your loved one’s finances more effectively.
- Don’t wait until it’s too late. Talk about it now.
Talking about money can feel uncomfortable for some, but as a caregiver, it’s important for you to have answers to a few key questions, like:
Q: How much money has your loved one saved, and what are their sources of income?
Q: Do you have investments/insurance policies/long-term care insurance?
Q: Who is their financial advisor/attorney/CPA?
Q: Do they want to live in assisted living or at home? - Review estate planning documents.
Ask your loved one if they have prepared estate planning documents and help them make sure each document is up to date. - Ensure all financial documents are organized and accessible.
In addition to making sure important documents are reviewed and updated, they should also be stored in a secure and accessible location. This includes Wills, Powers of Attorney, Financial Statements (investments and bank), Insurance Policies, etc. - Understand what’s important to your loved one.
As a caregiver, your number one priority is to carry out their wishes. Set aside time to have meaningful discussions about their preferences for receiving care. Do they have strong feelings about being cared for by their child? Are they okay with assisted living or nursing home or would they prefer to live at their own home? Ask them to write a letter expressing their desires and reasoning. While you may not be able to fulfill their every wish, understanding the sentiment behind the wishes will help you be more empathetic and understanding when it’s time to make decisions. - Seek professional advice.
When it comes to planning for a loved one, you should have three professionals you trust and can turn to: a financial advisor, an attorney for legal consultation, and a CPA for tax advice. - Explore public benefits.
There may be public benefits for which your loved one qualifies. Additionally, many veterans and their spouses qualify for certain government programs that aren’t common knowledge to the average person. Check your loved ones eligibility for benefits and resources at benefitscheckup.org. - Begin supervising finances early.
Elderly parent’s ability to manage their own finances can deteriorate at various ages. Begin monitoring their spending and bank accounts the moment any sign of confusion or struggle. This is especially important to protect against fraud and late fees should missed payments occur. - Keep them safe from scams.
Scammers are targeting the elderly online, via email, and over the phone at an alarming and increasing rate. Actively remind your loved ones of potential scams and measures they can take to protect themselves. - Consider the impact on your lifestyle and finances.
Caregiving can be taxing. Be sure to consider how caregiving may affect your life personally, professionally, and financially. - Continue ‘business’ as usual.
Though caregiving can feel (and often be) a full-time job, if you have the ability, do your best to keep working if you can. Keeping your source of income intact will help ease any financial strains. Moreover, keeping a job and having colleagues to connect with will be a welcome escape. Many employers offer benefits to employees who become caregivers so be sure to check your employee handbook and discuss your new responsibilities with your employer. - Get support and take care.
Caregiving is a hard job. It’s easy to forget about your own personal and emotional needs when you’re caring for someone else all day. Be sure to take care of yourself and get support when you need it. Check out local support groups to help build a community of resources and develop relationships with other people who are going through the same experience.
Yes, talking about finances and our personal wishes can be uncomfortable, but it’s best for all parties involved to have these discussions while everyone is healthy and of sound mind. If that time has already passed, which isn’t uncommon, it’s still not too late to make these tips a priority.
If you’d like to discuss any of these tips or the topic of caregiving further, please reach out to one of Kaydan Wealth Management’s financial advisors to get started.
