November has been designated as National Family Caregiver Month.
According to a recent survey from the National Alliance for Caregiving and AARP, approximately 43.5 million adults in the United States serve as caregivers for elderly parents or children. Roughly 80% of that number are caregivers of people older than 50.
One common denominator among all caregivers is that it can take a financial toll, but this can be lessened if you plan accordingly. Below are five key tips to help manage the financial aspect of caregiving for both you and your aging parents.
1. Make sure they have a power of attorney (POA). Once your parents' health starts to decline, it's important that another trusted family member can make financial decisions for them. There are many types of POAs but the one you want is a durable power of attorney.
2. Plan for your own financial future. You don't want to neglect your own financial health while caring for your parents. Setting up your own retirement plan should be just as important as making sure your parents' financial needs are being met.
3. Have a clear understanding of their long-term care coverage. Long-term care coverage pays for expenses not covered by traditional insurance and Medicare. This would include costs like long-term stays in a nursing home or a skilled nursing facility.
Before coverage kicks in on most of these policies, the insurance company wants to see a "triggering" event.
4. Make sure your siblings are on board. One of the most common causes of sibling resentment stems from caregiving for elderly parents and managing their finances.
It's important to sit down and have a conversation with your siblings and be clear on who will do what.
Some caregivers use a caregiver agreement that will stipulate who will care for the parents and what kind of monetary compensation they should receive.
5. Planning for Medicaid. According to Medicaid.gov, "12 million people are 'dually eligible' and enrolled in both Medicaid and Medicare, composing more than 15% of all Medicaid enrollees." Although many won't be eligible, it is still a good idea to check into it.
Finances can be a source of frustration and stress, but if you plan accordingly by following these steps, you can ease a lot of those worries.
Kaylynn Evans, MSM-HC, LNHA, CADDT, CDDM is executive director at Vineyard Bluffton. vineyardbluffton.com