Financial Care for Your Aging Parent. Lise Andreana
with key contact information and account numbers provided in case you need assistance.
4. Stay organized: Once caregiving begins, create a “Care Binder” (hard copy or via a shared online document) to house all the relevant information you and your family will need to maintain care for your loved one. Fill it with things such as schedules of upcoming appointments, medical information on types of medications and when they’ll need refilling, contact information for close neighbors and friends, and notes on any changes you notice in your parent, good or bad, that will be helpful to share with doctors and loved ones. Always take a list of questions and a pen and paper with you to medical appointments so that you can be sure to get all the information you need to adequately care for your loved one. Don’t leave the appointment until you have all those answers written down for future reference and clarification.
5. Communicate: Ask the questions that will help you understand the true wishes of your aging parents. Before you can truly make plans and budgets, you need to understand what type of care they are hoping for and where. Having realistic discussions about the cost of different facility options is essential. Ensure that all family members are aware of the wishes of the person who will need care, what the plan is, what different stages and related timing are likely to be involved, and that everyone is willing and able to take on their part in the plan. Make sure all siblings know who is going to be the power of attorney and what that entails.
While communicating, avoid making promises you may not be able to keep. If, for example, your parent asks you to promise to never place him or her in a nursing home, it may be more realistic to tell him or her you’ll do the best you can to avoid it, but if health and safety concerns make it the best option down the road, you need the flexibility to do what is best for them.
6. Create a budget for care: Research the costs of the different stages of care and ensure that adequate funds will be ready and accessible at those times. Partner with your parent’s financial planner to make this happen properly so any delays, surprises, or obstacles will be avoided.
7. Create a plan to care for the caregiver: In order to be an effective caregiver, you need to take care of yourself as well. You will need to take breaks to replenish and recharge your physical and emotional energy, so ensure you are building a plan to do so by having other people you can rely on when you need a break, and by making time for activities that you find enjoyable. Taking respite from your caregiving duties will prevent burnout. Enrolling your loved one in an adult day program is one option for respite, as is having someone else come to the home to perform some caregiving duties instead of you (some can be arranged for free by getting a referral by a doctor). For longer breaks, you can pay for your parent to have a short-term stay in a long-term facility.
You will also benefit from talking to other caregivers (in person or in online support groups) to help remind you that you are not alone on this challenging journey.
6. Benefits and Tax Supports Available to Caregivers
There are many benefits and tax supports available to caregivers. Read on for more information:
• Tax credits for caregivers: In the US, there are some tax credits provided by the government. Some of these benefits include deducting contributions a child made by claiming his or her parent as a dependent. This tax benefit can be used for deducting money a taxpayer paid towards his or her parents’ medical care and expenses. You can find more information by contacting the Internal Revenue Service (IRS) for Publication 502: Medical and Dental Expenses.
In Canada, under the Disability Tax Credit and the Medical Expense Tax Credit, you may be eligible for tax credits. If you are maintaining a home for an eligible dependent relative, you may also be able to claim the Caregiver Tax Credit as well, unless the person is your spouse or common-law partner. As of time of this book’s publication, there was also an additional Family Caregiver Tax Credit. More detailed information can be found on the Canada Revenue Agency (CRA) website.
• Personal emergency leave: Details for this benefit allowing you to take time off from your job may vary by jurisdiction, so it is best to check with your local government office for more details.
• Compassionate Care Benefit Program: This benefit is offered via Service Canada and more detailed information on qualifying and applying can be found on the Service Canada website.
• Family and medical leave: This is an unpaid, job-protected leave to provide care for a loved one who faces a life-threatening illness. Details and conditions vary by jurisdiction, so again, it is essential to check with your local government office for specific details.
• Attendant Care: You may be able to claim a partial or even full amount for a parent in a full-time nursing home, or the salary you pay to an attendant who cares for a parent in your home.
It’s also important to be smart about who claims what when it comes to tax time. Splitting caregiving costs and seeking tax breaks between spouses may have better tax advantages than doing it via one person’s tax return. Getting advice from a financial or tax planner on this can help maximize your tax savings.
7. Caregiving Will Change Your Life
There are many ways your life will change if you step into the role of caregiver, especially if you assume a caregiving role from within your own home when a parent comes to live with you. Your job, finances, and social life will be impacted. Your ability to travel, your emotional well-being, and your retirement dreams will be impacted. That sounds like a lot, but know that with good planning, that impact will feel far less overwhelming.
Remember that despite the challenges, there is a great feeling of satisfaction in knowing you are taking care of a loved one and helping him or her make the most of his or her later years in a safe and loving environment.
Another of my cherished clients, Dawn, went through this caregiving process with her mother not so long ago. Her mother was diagnosed with pancreatic cancer, and while many patients with this diagnosis live less than 12 months, Dawn’s mother lived another 5 years. Since Dawn was told of the short time frame expected, she willingly took on the full caregiving responsibilities for her mother, assuming that her mother did not have much longer to live.
While her mother enjoyed much better health in years three and four — thanks to remission and pain control — Dawn still experienced a lot of mental and physical fatigue in those five long years. Thankfully she had a very supportive husband who helped keep her from “losing it” or throwing in the towel, and little did they know that all the while, he was learning from her example and would use that knowledge to assist his own ailing mother shortly thereafter.
Finding a healthy balance between the rewards and the challenges can be done with awareness, diligent planning, and preparedness. There is still time to build a solid financial plan that will allow your parents to be taken care of in their home as long as possible, and in the facility of their choice, in the style and manner they wish, when the time eventually comes.
There is still time to ensure that your retirement dreams can come true as well. Most importantly, there’s no time like the present to get started. In the next Chapter, we’ll discuss how planning starts with you and your own retirement readiness.
1. Names and case details have been changed to protect the clients.