Steve Coker, CFP
According to AARP, more than one if five Americans are caregivers. As Americans age and life expectancies rise, more and more people find themselves caring for an aging spouse, parent or family member. And yet, few Americans think about or plan for caregiving. If you are planning for the future, take time to consider how elder care may impact your retirement, as a caregiver, or as a someone in need of care. Too often, the conversation is limited to long-term care insurance, but it should be much broader than that. Here are some things to consider.
Before the crisis
The first step is to arrange your life to be prepared to give or receive care. In my opinion and experience, when it comes to elder care, one of the most critical steps is to plan in advance, and take action before there is a crisis. I do not mean merely financially. For example, as we age, it can be very important to move closer to family, or closer to medical care, or closer to a grocery store, or to a one-story house. Too often the decision to move is made only when there is a crisis, after a fall, or a medical crisis forces the issue and decisions are made in an emergency. It is much better to look ahead and consider what life will look like 5 and 10 years down the road. How might life be different? Do I have a good support structure with family, friends, church, or doctors close by? Do I have a game plan if care is needed? These can be difficult decisions, but I believe planning ahead can help avoid those crisis moments and leave everyone better prepared to deal with aging.
Plan for costs
Of course, planning for the cost of care is also important. This does not necessarily mean that everyone needs to go buy a long-term care policy, but it does mean that your long-term financial plan should be robust enough to provide funds for your care. Planning for caregiving costs can be similar to planning for college costs. They vary widely, but often run several hundred thousand dollars over 3 or 4 years. If the funds aren’t there, you can at least develop a game plan. For example, selling or downsizing your home can be a viable source of funds to pay for care when you can no longer live independently. There are many options, but what is the plan?
Finish estate planning
Only weeks before they needed critical care, my father-in-law and mother-in-law finally completed their estate planning, providing power of attorney and advanced medical directives that were essential. Estate planning is not just about deciding who inherits your money when you die. A good estate plan will provide caregivers with the power to help manage your affairs, and guide doctors with your wishes. It is difficult to imagine what we would have done without these core documents. Take time to create these documents so there is legal authority for caregivers to act when the time comes.
Live life while you are healthy
Planning is not just about worst-case events, it is also about considering your purpose and goals while you are here. One of my favorite sayings is ‘we don’t get to be here long’. That isn’t a pessimistic view, it gives me a sense of urgency in every day. What do you want to do now while you are still healthy? Do you have something to say, a calling to fulfill, someone to bless? Is there a dream trip that you would like to take with your spouse, or a lifetime goal to fulfill? Sometimes there is a tendency to be too cautious and become fatalistic when we look ahead. Yes, we need to plan for long-term care, but we also need to plan to live. When we develop plans, we want to be wise, but not fearful, of the future.
There is a high probability that each of us will either provide care or will need care during our lifetimes. Those can be incredibly stressful times, but thinking ahead can help. If you would like to discuss your long-term plans, please give us a call. We would be happy to be a sounding board as you consider your future.