If you’re at the age where you’re caring for your children as well as your parents, you’re probably facing some challenging financial decisions, like how to cover everyone’s needs while sticking to a budget.
And when it comes to aging parents, their needs can change very quickly. Here are four ways to better plan and budget for your parents’ future.
1. Get Started Early
Your parents will likely become dependent on you as they get older, so it’s important to have conversations about the future as early as you can. These talks might be hard for both of you. Acknowledge this by saying, “I know it might be tough for us to talk about this, but I want to make sure we’re planning for your future needs so you have the support you deserve.”
Then, be prepared to take the lead and ask specific questions:
- Do your parents need any assistive devices or accommodations that you might not be aware of?
- Do they have a handle on their finances and are they paying their bills responsibly?
- Do they have a will or estate plan?
Once you know the answers to these questions, you can make a plan to address them, as needed.
2. Put Legal Documents in Order
Perhaps your parents have already taken some steps to plan for this stage of their lives. Do they have health care, financial and real estate proxies or powers of attorney? Who are those proxies? If your parents don’t have these documents in place, encourage them to start thinking about the importance of getting these papers in order. These documents can provide you and other family members an understanding of your parents’ wishes, for example, in the event of a health emergency where they are unable to express their decisions.
You’ll also want to confirm if your parents have wills in place, and if they’ve named an executor of each of their wills. If they’ve chosen a family member to make estate decisions, ask your parents if that family member has been made aware of this decision. Clear roles and responsibilities will help everyone navigate challenging moments more easily.
3. Research Long-term Care Options
Long-term care can be complex and costly, and planning for these costs is key to confronting future financial challenges. One long-term care option is “aging in place,” which means your parents will be cared for at home. Some older adults have more acute health concerns that require round-the-clock care. Others need end-of-life care, such as hospice.
As you plan for your parents’ future, you’ll want to discuss the potential costs of different types of care and figure out if you’ll have to factor any of these expenses into your own budget.
4. Be Prepared to Make Estate Decisions
If you’ve been named the executor of either of your parents’ estate, you’ll be responsible for managing their assets after they’ve passed away. This could involve selling certain assets or property. Know whom you’ll need to involve in this process, whether it’s siblings, other family members or professionals – like an attorney. Start communicating with everyone early on to avoid complications later.
Coping with parents’ needs as they age can be stressful, both emotionally and financially. Planning ahead will help you, your parents and other family members confront the challenges of aging with greater ease.