According to a recent CBS MoneyWatch article, “How to ease the pain of paying for elder care,” the cost of caregiving for parents, spouses or partners is shared by members of all generations. Baby Boomers spend 13% of their annual income on unpaid caregiving, while members of the 71 to 91-year-old Silent Generation spend about 25%, mostly on spouses or partners. Gen Xers—ages 35 to 50—spend about 24% of their annual income on caregiving for parents, and millennials (ages 18 to 34) spend the largest percentage, at 27%, belying many stereotypes.
To address the impact of these costs on the household, have a family meeting to assess your family’s financial and aging status and to plan for the future. These discussions can help you plan for future elder care expenses by creating a plan and a budget, along with planning for retirement savings and savings for children’s education.
At Family Estate Planning Law Group, we strongly encourage our clients to hold family meetings, and not just to discuss long-term care. The better your loved ones understand your estate planning, the better the chances the plan will work the way you intend. We help our clients outline the planning they’ve done, the reasoning behind it and the responsibilities of any trustees or other fiduciaries. Having a plan in place and making sure everyone knows their part is beneficial because when a crisis does occur, everyone knows their role.
One source: ease the financial burden of caring for a loved one by investigating government programs. Many advocates anticipate legislation that will aid family caregivers in the near future. State and local governments may also offer tax breaks and other aid programs for seniors, particularly those individuals needing home renovations to stay in their homes. Those tasked with caregiving should also look into neighborhood religious and community groups for support. There may be senior- and disabled-specific funding programs, along with able-bodied volunteers who can help lighten the load.
Depending on the family’s financial situation, including time constraints due to work schedules, it might make sense to look into professional help. An elder law attorney should be able to recommend professionals who can help the family delve into available resources. These professionals are usually social workers, gerontologists or other health care professionals with a focus on helping the elderly. They will be able to help you and your family plan for medical and other emergencies.
If you or a loved one will want to qualify for Medicaid assistance, there’s even more planning you should do ahead of time. For example, while gifting strategies can minimize your gross estate for estate tax purposes, Medicaid has a 5 year lookback period. Any gifts made in the 5 years prior to a Medicaid application are counted as part of your assets. Given the strict financial tests to qualify, you may need to start re-thinking your estate planning strategies now.
Your estate planning and elder law attorney will also work with your family to make sure that important documents, including power of attorney, health care proxies and other important documents are in place. Doing the planning in advance of an emergency is advised, since you will have more options and avenues of assistance.
For more information on Medicaid planning and elder law, explore our website and contact us to schedule your consultation today!
Reference: CBS MoneyWatch (December 23, 2016) “How to ease the pain of paying for elder care”