Holidays are a time when family comes together. How are Mom and Dad this year? Given the COVID situation, this holiday season may be the first time in many months that "the kids" have had the opportunity to see their parents in person. It may also be a time to discover whether their parents are showing signs of diminished health. Don't ignore the signs, but rather use this time to explore what's truly going on and what your parents are planning to ensure their continued health and well-being.
COVID has made us all re-evaluate what we want retirement to look like. If the plan is for them -- or yourself -- to stay in your home and have healthcare come to you when needed, there's a measure of planning involved in making sure we'll have the means to pay for those services.
What is your plan? What's their plan? Will you and your parents share your desires regarding how you wish to be cared for? Are their current savings sufficient to cover the cost of care? If not, which family member will be the caregiver? Do you have the documents in place that give that person the required authorization to care for the family both medically and financially.
These are sometimes difficult questions to bring up over dessert, but this year the pandemic gives us all an excuse to deal with matters of serious consequence and NOT doing so carries significant risk. Among the biggest risks in planning for retirement is the risk of longevity. We and our parents all are living longer, so having enough money to live on and the money to provide the care we'll need is ever so much more important than who is winning the football game.
Here is a short checklist of queries to make things easier.
Who will be the caregiver? Who will likely need care? How will it be provided and paid for? How much does care cost? What assets are available to pay for the care? Are there any consequences to using those assets?
There are many ways to fund health care costs and the costs of aging in place, Some have tax advantages associated with them both for business and for individuals. Some benefits are restricted if you have too much income. You should know that Medicare does not pay for most long term care unless you meet certain criteria, but there are strategies you can use to combine multiple retirement vehicles to give you more options.
So, have "the talk," then come see me. I would love to help with your individual situation.
Colleen Stutz, SonRise Strategies, LLC
899a Harrison Street SE
Leesburg, VA 20175-4033
Phone: 703-403-3187
