Giving mom the gift of long-term care

We're always thinking about our mothers, not just on Mother’s Day.

And that means making sure mom has all the care she needs, especially when it becomes harder for her to take care of herself.

InvestmentNews sat down with Arvette Reid, client services director at Lifecare Affordability Plan, to learn how children can best provide for their aging parents without sacrificing family harmony or jeopardizing their own financial futures.

InvestmentNews: When is the best time for a child to consider a long-term health care plan for a parent?

Arvette Reid: This is a great question, and you’re doing the right thing by getting started early! The best time to consider long-term services and support is before your parent experiences a health care event like a fall, heart attack, car accident or cognitive decline. While every family is different, one of the first steps is to confirm the adult child has the authority to make decisions in the event mom or dad aren’t able to for themselves. Most families aren’t comfortable discussing money around the dinner table. But while this conversation may be uncomfortable, it’s in your family’s best interest to have a frank discussion about finances with your parents and other key family members. Unfortunately, most families have conversations about long-term health care for the first time in an emergency room. Don’t let that be you!

Here are three tips to assist your aging parents with organizing their finances: 1) gather and review all legal and financial documents; 2) ask your parents if you can attend the next meeting with their financial adviser; and 3) most importantly, treat your parents with dignity. Following these steps can save you time, stress, and money and put you in a better position to care for your parents.

IN: How do you get the entire family on board to agree to a comprehensive long-term care plan?

AR: When buying a house, you typically work with a team that includes a realtor, a loan officer and an inspector, each playing a pivotal role in supporting you and your vision. Similarly, it is necessary to have a team of well-versed health care, legal and financial professionals to guide you through determining affordable health care options for your parents. It’s okay to reach out for help and assistance in these matters, whether for simple advice or full-service options.

Aside from involving multiple professional disciplines in a coordinated team, the best family conversations to drive agreement on a plan is to start with what mom (and dad) are most hopeful for if their health changes. Do they want to stay at home? Do they want to stay together under all circumstances? Articulated hopes during times of hardship can galvanize families and empower decision-making in the face of sometimes ambiguous circumstances. Once you have a better idea of what your parents want now and, in the future, a financial advisor can then help outline the best strategies to pay for the plan.

IN: How should housing, such as an assisted living facility, be included in a long-term plan for a parent?

AR: Author Ryan Frederick of 'Right Place, Right Time' argues that 'where you live matters enormously — especially during the second half of your life. Place plays a significant but often unacknowledged role in health and happiness.' Many people don’t know how much long-term care will cost, especially with so many options available. Companion care, home care aides, live-in aides, assisted living communities and nursing homes all vary significantly in price. Contact your local area agency on aging, an aging life care manager, or even plan to visit a nearby assisted living community to get current pricing.

Also, consider that an assisted living community or rehabilitation center might be your family’s default option in the event that someone cannot be safely discharged back home after a hospital stay. Knowing where someone might be admitted in those circumstances can be an eye-opening place to start planning. Gathering information in advance and knowing your options before the need arises can help you make more informed decisions. The goal is to learn the basics before you need to because digesting brand-new information in an emergency is not ideal and makes decision-making far more difficult.

IN: How do you make sure that a family can get the best coverage for their parents without jeopardizing their own financial futures?

AR: When considering their financial future, the key is realizing your parent's monthly income and assets will be used to pay for most of the long-term services and support they will need. That is why it’s essential to get a complete picture of your parent's finances. Work together to gather critical documents. Make a checklist of investments, pensions, wills, trusts, life insurance policies, power of attorney documents, income sources and anything that could be money-adjacent. Doing this ahead of time will make things easier to organize, especially if your parents are in good health and can communicate the significance of their assets and income.

However, if your dad is diagnosed with Alzheimer’s and is expected to die first, not only is it important to determine how to pay for his care needs, but it is also just as important to figure out how your mom will be taken care of with the remaining assets and monthly income. For example, do you know if dad’s pension has a survivor benefit? For families with means, stand-alone or hybrid long-term care insurance is an additional option. But in reality, only 49,000 people purchased traditional LTCI in 2020, according to the American Association of Long-Term Care Insurance. It's best to consider all options to pay for care, including but not exclusive to long-term care insurance.

IN: What is the biggest problem that families run into when planning for their parents’ welfare and how do you help them solve it?

AR: Most families cannot imagine being 'less able' before it happens, and therefore most families have 'the talk' too late. If you cannot imagine being dependent on others for your daily needs, then it follows that you cannot easily discuss steps to take in that circumstance. It can be a difficult and emotional topic, but it is the first step toward getting decisions and their financial elements under control. Taking the first step is crucial to conquering these fears, especially as your parents' age. 

Once more, focus on the outcomes your family is most hopeful for if Mom or Dad becomes less able and use that as a foundation to proceed with planning. If your parents try to brush off the conversation and won’t give you the basics about their finances, explain that they are helping both futures — theirs and yours — since older adults want to make sure their kids are taken care of.

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