As life spans extend and seniors live longer, many adult children are tasked with supporting their aging parents. Sometimes parents need financial assistance. Find out how to keep your parents financially solvent without breaking the bank.
Reduce Familial Tension
Money can cause a great deal of tension within families. Before your senior loved one’s financial woes become too severe, broach the topic with other family members. Many times, these situations cause strife among siblings who can’t agree on how to handle their parents’ money issues. The first step is to assess your loved one’s current financial status. Organize all the relevant information, ranging from bank accounts to 401k plans to legal documents. Once your loved one’s finances are assessed, you can start to plan for his or her future.
It’s also important to discuss issues such as your loved one’s future care needs, which may require hiring a professional in-home caregiver. Many seniors prefer aging in place over moving to assisted living facilities. If your senior loved one needs assistance to remain safe and comfortable while living at home, reach out to Home Care, a leading elder care agency. Our dedicated in-home caregivers can assist with meal prep, bathing and grooming, exercise, medication reminders, and many other important tasks.
Divide Responsibilities
Not all family members will be able to contribute equally. When beginning this process, have a calm discussion with your siblings and create a reasonable division of financial and time-based assistance. Siblings who can’t provide financial assistance may be able to assume caregiving duties. Those who can provide money should decide how and when they want to contribute. They might choose to cover medical costs or reimburse your loved one for his or her monthly expenses.
Trim Excess Expenses
Financial assistance doesn’t always mean giving parents money. Sometimes it means helping them stretch the funds they already have. When assessing your loved one’s finances, look for ways to trim expenses or create new income streams. A reverse mortgage, an annuity, and other financial options can increase your loved one’s cash flow.
As a family caregiver, you may have to handle your loved one’s finances. However, your caregiving duties may make it difficult for you to keep track of his or her expenses and tend to other important tasks. Caring for a senior loved one can be rewarding, but it can also be overwhelming for family caregivers who have other responsibilities they need to focus on. For these families, the perfect solution is respite care. Harrisburg families rely on our caregivers whenever they need time to rest, work, run errands, and even go on vacation.
Brush Up on Tax Law
In some situations, children supporting their parents may be able to claim them as dependents for tax purposes. This can be a great benefit for adult children who are having difficulty supporting themselves as well as their parents. Before making any financial commitments, figure out how it will impact your loved one’s finances. For example, gifts of money may incur gift taxes. Many people pay their parents’ bills directly, ranging from insurance premiums to medical bills. To help with housing, some adult children buy properties for their parents and charge them a small amount for monthly rent. This ensures the properties won’t be assessed as gifts for tax purposes. Because of the complexities of tax law, it’s always a good idea to speak with an accountant before making major financial decisions.
Start to Budget
Accountants and financial advisors can help people find sources of income that can be used to assist their parents. There are many available options, and many people simply aren’t aware of them. For medical expenses, there are government programs like Medicare and Medicaid. Long-term care insurance is an option, and some seniors may qualify for veterans benefits. When budgeting for your loved one, it’s important to research all the pertinent tax options and government benefits.