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Aging parents and long-term care

Many Americans are faced with not only planning for their own care but providing assistance for their aging parents. Because Americans now live longer than ever before, they face unprecedented financial challenges. Not only must savings stretch to cover more years, they must be substantial enough to help pay the costs of medical care not currently covered by Medicare or standard supplemental policies. Long-term care insurance is a relatively new option that may provide some relief. We can provide you with an overview of long term care insurance options that you may want to consider. To protect your family’s future, take stock of your finances and consider the following tips:

  • Maintain cash reserves. Long-term savings and investments form the cornerstone of financial stability. In addition to standard accounts, develop a cash or easily liquidated reserve account for emergencies; most experts recommend maintaining enough readily-accessible assets to cover three to six months of expenses.
  • Be adequately insured. The term "risk management" refers to the combination of insurance types that best meet your particular needs. Standard categories of insurance include:
    • Life Insurance - While your employer may provide some coverage, it is usually wise to calculate the appropriate amount you need, and if necessary, supplement this employer provided policy with additional insurance. The types of life insurance from which you may choose include "Term," which provides coverage for a set period of time and pays benefits only in the event of death. "Whole Life," "Variable life" and "Universal life" policies, all of which include a savings component, are also available. At Granite Wealth Management we can help you determine how much insurance you need.
    • Disability Insurance - Many employers also provide disability insurance, which helps cover living expenses in the event of a debilitating event. However, most families will benefit from a review of current policies to determine if additional coverage is needed.
  • Consider long term care insurance - Increasingly popular, this category of insurance can shelter a family’s savings and the estate of the insured in case of long-term illness or disability.

When caring for an aging parent, these details may prove helpful:

  • Make a caregiving budget. Before making a caregiving decision with financial consequences, put together a detailed look at what you are spending on caregiving. Include a list of your parent's resources and how they might be better used to support caregiving activities.
  • Explore free or low-cost public benefits. Check out the government's eldercare locator. The National Council on Aging operates a benefits checklist service, and the National Association of Area Agencies on Aging has extensive information on caregiving help, plus an online locator to a local office in your area.
  • Learn about Medicare and Medicaid. What kind of Medicare coverage does your parent have? Do they also have a Medigap or Medicare Advantage policy? A drug plan? What are the co-pays, out-of-pocket limits, and other financial aspects of their insurance? Learn more
  • Understand the costs of keeping your parent in their home or moving them into yours. Most people want to grow older in their own home, surrounded by possessions and memories. Or, it may be easier to move your aging parents in with you. How much will such "aging in place" cost, and can you find help? This calculator can provide you with a rough estimate to be used for comparison.
  • User names and passwords. If possible, get access your parent’s user names and passwords for their electronic accounts.
  • Consider professional help. If your parent's needs are extensive and challenging, consider hiring a geriatric-care manager to put together plan for you. They can often identify community resources to reduce your own expenses and time. The National Association of Professional Geriatric Care Managers can explain professional standards and services, and also has a locator to help you find a professional nearby.

At Granite Wealth Management we can help you determine the best approach to pursue your family’s needs. Contact the Granite team to see how a comprehensive financial plan can help work towards your goals: Contact the Granite team.

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