There is much to celebrate about the average American’s increasing longevity. You have more years to accomplish your life goals, and your parents may be able to really get to know their great-grandchildren. Still, those extra years and the infirmities that commonly come with old age also mean that people need more care—which, in turn, implies multidimensional concerns.
LAYING THE GROUNDWORK WITH LOVED ONES
To prepare for the future, some actions can be taken now. Planning becomes even more important if you are likely to shoulder the responsibility of making caregiving decisions for your spouse, your parents or others. Three basic steps can get you on the right track:
Involve a strong team.
Let us say you are overseeing the care of an aging parent, and communication has become difficult. Your decisions may greatly benefit from an established relationship with your mother’s or father’s doctor, attorney, accountant and financial advisor. Additionally—depending on your parent’s needs—you may want to call on a social worker and a geriatric care manager.
Have a conversation.
The more you know about your parent’s or spouse’s wishes, the better.
Discussions about care are generally not easy, but knowing what someone really wants can be an enormous help in simplifying the decisions you need to make down the road.
Get some things in writing.
You’ll want to have quick access to basic information such as social security numbers, Medicare information, insurance policies, legal documents and financial statements. Additionally, there are a number of strategies that empower loved ones to make decisions and to record other wishes. These include:
- Durable Power of Attorney: This document gives you the authority to make legal and financial decisions for another person in the event that he or she is no longer able to do so.
- Living Will: Also known as an advance directive, this document guides medical professionals and family members in determining what treatments should be considered.
- Healthcare Proxy: Essentially, this is a medical power of attorney that enables you to make medical decisions on behalf of the person you are caring for.
EVALUATING COST
Research shows that almost 70 percent of people age 65 and older will require some degree of long-term care over the rest of their lives.1 The associated costs are considerable: The median cost of a private nursing home in the United States is approximately $91,250 a year, and the median cost of in-home care assistance is approximately $20 per hour, or $45,760 per year for a 40-hour week.2
Given the price tag for services, it may make sense to earmark savings for future care needs. You may also want to analyze the benefits of long-term care insurance. These policies provide coverage for nursing home care, assisted living facilities, home care, community-based care or a combination of these services.
Whatever your role, some preemptive steps will help prepare you for an oversight role and allow you to enjoy a longer life ahead with your loved ones.
1National Clearinghouse for Long Term Care Information, U.S. Department of Health and Human Services, 2015.
2Genworth Cost of Care Survey, 2015.
Marie A. Moore is a Financial Advisor with the Wealth Management division of Morgan Stanley in Dallas, Texas. The views expressed herein are those of the author and may not necessarily reflect the views of Morgan Stanley Smith Barney LLC. Member SIPC. www.sipc.org. Morgan Stanley Financial Advisor(s) engage Worth to feature this profile. Marie A. Moore may only transact business in states where she is registered or excluded or exempted from registration, www.morganstanleyfa. com/themooregroup. Transacting business, follow-up and individualized responses involving either effecting or attempting to effect transactions in securities, or the rendering of personalized investment advice for compensation, will not be made to persons in states where Marie A. Moore is not registered or excluded or exempt from registration. The strategies and/or investments referenced may not be suitable for all investors. Morgan Stanley Smith Barney LLC, its affiliates and Morgan Stanley Financial Advisors or Private Wealth Advisors do not provide tax or legal advice. Morgan Stanley Smith Barney LLC offers insurance products in conjunction with its licensed insurance agency affiliates. Certified Financial Planner Board of Standards Inc. owns the certification marks CFP®, CERTIFIED FINANCIAL PLANNER™ and federally registered CFP (with flame design) in the US. (CRC1368245 01/16)
This article was originally published in the February/March 2016 issue of Worth.
