08 Feb Preparing for Senior Living: What You Need to Know
Your mother may keep falling in the bathroom. Perhaps your father is forgetting to eat dinner or take his blood pressure medication. Maybe your grandparents are perfectly fine for their age, but don’t want to deal with maintaining the lawn, shoveling the driveway after snow falls, negotiating the stairs, or driving to the grocery store. It’s time to consider senior living. This comes with a myriad of emotional hurdles as well as practical considerations. Wouldn’t it make sense to be able to focus on your loved ones instead of on logistics and to have a financial plan in place before you reach this point? About 70% of seniors over the age of 70 can expect to use some form of senior care, according to the US Department of Health and Human Services. This blog discusses what you need to know about your loved one’s finances as you prepare for senior living.
Do they have insurance?
According to AARP, only 7.2 million Americans have long-term care insurance. It’s easy to see why–long term care insurance is costly, especially for seniors on a fixed income, and the costs increase each year (for instance, costs increased 40% in 2019, with steeper increases projected). However, according to the American Association for Long-Term Care Insurance (AALTCI), the number of individuals with long term care policies has risen and continues to rise. If your loved one has a policy and has been paying the premiums, this is a terrific first step. It is even possible to convert a life insurance policy into a Long-Term Care Benefit Plan. Find out more about this option in our Family Guide to Funding Senior Care and Housing.
Do they have a power of attorney (POA) in place?
A Power of Attorney is a friend or relative with the right to make financial or medical decisions for your loved one. The documents may show that the power is durable (was in effect from the moment it was signed) or springing (will take effect in case of incapacity). Having a power of attorney document in place is a time saver and can help you avoid red tape and an overwhelming crush of bureaucracy.
Do they own their own home?
Obviously, the equity in a home is a huge advantage, especially when you have time to make minor improvements and stage it to get the highest market value possible. If your family member is not quite ready for senior living yet, this is the perfect time to spruce up their house so that you can immediately put it on the market when the decision is made. Find the deeds and mortgage papers ahead of time.
Where are the financial documents?
While you rummage through the basement or through the drawers in the office looking for mortgage documents, look for other relevant documents as well. For instance, you will need to know about your loved one’s pensions, rotating bills, bank statements, stocks and bonds, social security statements, taxes, medicare, and health insurance. Basically, gather everything, and organize ahead of time.
Do they have a financial advisor and/or an estate planning attorney?
If not, consider consulting one. The financial considerations are not easy to manage, and an experienced expert may save you a considerable amount of money and time. A specialist attorney will know if your loved one is eligible for any special programs. He or she will also be able to help with tax deductions you may not know about.
What do they want?
Your loved ones may have aged, but they are still in charge of their own lives and must have a say in any future plans. This is another reason to make these plans before memories possibly fade or before they are absolutely necessary.
You should also involve other concerned family members in your discussions. Talk about who is willing to help and how responsibilities will be delegated. Discuss various senior living communities and locations. For instance, does it make more sense for your parents or grandparents to stay in their own community or to move to a community close to relatives who can then visit easily? There are pros and cons to both scenarios. Finances are involved in this decision, too. Have “the talk!” Being able to plan ahead will ease everyone’s mind.
No matter what you find out or decide to do, you and your loved ones are not alone. For more detailed information and advice, download this comprehensive guide from Golden Lodge Assisted Living and Memory Care: A Family Guide to Funding Senior Care and Housing