Managing Finances for Aging Parents [Checklist]

A checklist for supporting your parents in retirement and beyond

In the coming years, many of us will find ourselves in the position of providing support to our parents as they age. Whether managing finances, guiding care decisions, or ensuring their needs and desires are being met, as with so many things navigating these challenges can be made easier by working from a predetermined plan.

Bartlett’s own Laura L. Humphrey, Wealth Advisor and Principal, and Melissa Mabley Martin, Wealth Advisor, regularly work through scenarios like these with their clients – both in preparation for the future and in response to crises. Inevitably, they discover that having key plans and documents in place alleviates some of the stress associated with supporting loved ones through their later years.

Here’s their checklist should you find yourself managing your parent’s care:

Open the lines of communication

Grappling with the reality of assisting your aging parents is never an easy task. But it can be significantly more difficult should an extreme circumstance force you to unexpectedly jump in with both feet. Broaching sensitive but essential health and financial topics with your parents early, while they are in good health and of sound mind, can help both of you ease into the process in a more gradual way. Simple, straightforward conversations about key contacts, important documents, and general wishes help lay the groundwork and keep everyone prepared.

Update or create an estate plan

Check in with your parents to ensure they have basic estate planning documents and that they’re up to date. Knowing whether such documents exist (and encouraging/helping your parents to procure them if they don’t) is critical to being able to step in more seamlessly when the time comes.

So, what should they have?

  • Will
    A will serves as an important base document, designed to direct where assets go after death. A will names an executor to guide things along through probate (the court process that moves assets from the deceased to their beneficiaries). The probate process can be expensive, lengthy, and difficult, but if a person dies without a will (referred to as dying intestate), the courts decide where the assets go, and these laws vary by state. Designating how assets should be allocated upon death in advance goes a long way toward eliminating unintended future consequences.
  • Durable Power of Attorney for Property
    durable power of attorney for property names someone to direct your assets in the event you become incapacitated, or it can go into effect immediately. Many people name a spouse as their primary designee, followed by successor powers such as a sibling or adult child.
  • Health Care Power of Attorney and Living Will
    Similarly, a health care power of attorney gives your designee the ability to direct a physician in the event of you are unable to do so. This person is legally bound to act in your best interest and to follow what they believe your wishes would have been. A living will outlines such wishes and can help guide your power of attorney in making decisions that align with your desires. Living wills generally spell out your beliefs and preferences on three primary points – artificial nutrition (tube feeding), resuscitation (CPR) and ventilation.
    Don’t forget!

    Review documents regularly to ensure they’re up to date. It’s important ensure these essential documents so they’re updated as preferences evolve. For example, as a result of the COVID-19 pandemic, many have changed their views on the use of ventilators, and it’s important their legal paperwork reflects that.

    Know where important documents are located! It’s not enough to arrive at the hospital and inform the staff you are a patient’s power of attorney. You must produce appropriate documentation. Until you are able to do that, the hospital will make medical decisions based on their protocols.

    These documents are useful at any ageOf course, as people get older, they are more likely to encounter medical intervention, but the unexpected happens every day. Outlining your preferences in legally-binding documents is the best way to safeguard your preferences in the event of a life-altering situation. 

Build a long-term care plan

Many of our parents are going to require long-term care during their lifetimes, particularly once over the age of 65. So, it’s important to be aware of the implications and to put a plan in place. Here are a couple of things to think about:

  • Ask your parents if they have long-term care insurance.
    Many reaching retirement age today would have been buying long-term care policies when they were first being issued. If your parents have one and it has not lapsed, review the policy so you know what is covered and how to deploy it.
  • Talk about where they’d like to go if they need long-term care. This can help alleviate the pressure of making the decision in a desperate moment. Many think they’d prefer to stay in their home – and while this can be a possibility, sometimes it’s just not feasible. Talking through where they’d be most comfortable in the event they’d need to move will help you be more ready to act should the situation arise.

Guide decisions with a financial plan

It can be a delicate subject to discuss, but it’s important to know some basic information about your parents’ finances. Things to know include:  

  • What are their income sources?
  • What is it used to cover?
  • Who are their key contacts (attorney, financial advisor, etc.) and how can you reach them if you need extra assistance?
  • Where are their accounts held and how are they invested?
  • What needs to be paid and when?

Gaining this sort of information often becomes trial by fire when a family member steps in after someone becomes ill. It helps to get the basics of your loved one’s financial picture well in advance of when it’s needed.

Check in regularly

While legal documents give you the right to take over in the event your loved one is incapacitated, it may be prudent for you to step in before things become too extreme. Checking in regularly and in simple ways can help. When you visit your parents, look around to see if there are big stacks of mail or unfamiliar bills sitting around. When you talk on the phone, note if your parent seems more forgetful. Ask if you can help or offer to take something over to lighten their load.

We love our parents and we have good intentions to honor their dignity, so as they enter their declining years we can be hesitant to step in – particularly because things happen so gradually. But in our experience, the sooner you get involved, the easier it is to ensure you fulfill your parents’ wishes and uphold their legacy.

We’re here to help every step of the way. Our family office wealth management services are designed to cohesively coordinate your family’s affairs into a unified vision for wealth and well-being. Reach out to your Bartlett advisor to discuss your family’s circumstances. 

Laura L. Humphrey, Certified Financial Planner® and Accredited Domestic Partnership Advisor®, has more than 28 years of investment experience, coupled with her strong leadership track record, make her an important asset to the Bartlett team of wealth management professionals. At Bartlett, Laura works primarily with high net worth individuals and their families, providing investment planning and advisory services. Learn more about Laura

Melissa Mabley Martin is a Certified Financial Planner® and Certified Divorce Financial Analyst®. As a Wealth Advisor, Melissa assists with a broad range of planning issues including retirement planning, tax planning and estate planning. She is particularly experienced in developing financial strategies related to major life events such as death or divorce. Learn more about Melissa

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