One of the most important things you can do to help your aging parents
is assist in planning their estate. This will clarify their wishes and
ensure that they receive the best care possible without placing a
heavy financial burden on you and the rest of your family.
Read 247 Plan Your Estate to get the lay of the land. Open up a conversation with your parents. Keep it low-key and relaxed. Start by asking them who should look after their affairs in the event of any medical emergencies. That may pave the way for a dialogue on your parents' financial affairs. If not, spell out the chaos and confusion that could result from not addressing the issue. Be patient, be respectful, and have this conversation in several sessions if necessary to smooth feathers. At a minimum, get names and contact information for their attorney, financial planner, CPA and bankers.
Designate a point person for your parents' health-care affairs. Ideally this person is designated by your parents, is objective, and has your parents' best interests in mind. It could be you, a sibling, a family friend or one of their trusted confidants.
Have a backup plan. In the event that an estate designee isn't on hand to make a decision, select a second person--ideally one who is equally familiar with your parents' situation.
Discuss drafting a living will. Assure them that this document forces medical providers to honor their personal medical choices in the event of a debilitating condition, such as a terminal illness or coma, when they are no longer able to speak for themselves. See 294 Arrange Hospice Care.
Designate someone to handle their financial and business affairs. Even if a parent is ill or otherwise incapacitated, the bills don't stop coming in. One option is to draft a durable power of attorney. See 245 Execute a Power of Attorney.
Join forces with your siblings or other family members to decide your parents' fate if they have passed the point where they can make their own decisions. Conduct good due diligence beforehand when researching the costs of home care, assisted living, retirement homes and other items associated with long-term health care. See Warning.
Craft your parents' estate plan in a way that passes on assets to heirs as easily as possible. A good estate-planning attorney can help. The National Academy of Elder Law Attorneys (naela.org) specializes in parental estates.
Tips & Warnings
- Some estate plans may also be tailor-made for a living trust. That way, if a parent becomes ill or incapacitated, the designated trustee can take over and administer your parent's financial affairs. See 243 Create a Living Trust.
- See 295 Make Your Final Arrangements and 349 Plan a Funeral According to Custom.
- If no one is designated, a family member can take over. This scenario is legit in the eyes of the law, absent another guardian. The designee can ensure that appropriate decisions will be made when the parent or parents cannot do so.
- Medicare does not cover long-term care, so you'll have to find long-term health-care options on your own. Encourage parents to purchase long-term healthcare insurance if you feel not doing so could eat their entire savings. Or pitch in with your siblings and pay the premiums. Review 237 Choose a Health Insurance Plan.