I often hear children with aging parents refer to their parents’ assets as their inheritance.
We now are living in an age where people are living much longer. It is highly likely that parents will outlive their assets rather than pass them on.
Good financial and estate planning needs to take this longevity into account. As we have more golden years, it will cost more money. As we age, we will encounter more illness and disability. How do we plan for these outcomes?
Family discussions are important as we confront these questions. What are parents’ expectations concerning their incapacity? Do they believe that they will be cared for by one of their children? Do the children have the same expectation?
How will a parent be cared for if they are simply unable to live independently in the family home? Will it be by moving in with one of the children? Will it be moving to an assisted living home? How do the children feel about their parents’ wishes?
Financial considerations are important as well. Will parents have sufficient assets and income to afford assisted care?
How will a parent be cared for if they are medically incapacitated by severe illness, dementia, or stroke? Are the parents opposed to nursing home care? Are the children prepared to take their parents into their homes and give them skilled nursing care?
How would the financial aspects of this care be addressed? Do parents have long term care insurance? Is it available and affordable? If no, what is the plan?
If the plan involves living with a child, would there be a financial consideration for that child? It is best to discuss this with all family members present.
These are very difficult questions but they should be addressed prior to an illness or accident. A plan should be developed by the whole family. Planning is key.