(2 Minute Read)
As Baby Boomers start to retire, there are probably a lot of things on their minds: where they might move, a few nice vacations, new ways to fill their time. But one of the things that many don’t think about is what is happening to their parents. As the parents of the Boomers continue to get older, many will start to need special care that not only requires time, but also a lot of money that their parents may simply not have.
Long Term Care
For parents that need to stay in nursing homes, you could be looking at almost $90,000 (or more!) per year. Insurance may help cover some of those costs, but for the rest, there should be a big nest egg that contributes to those costs. And depending on how old the parent is, they too might be in risk of running out of their own retirement money, making it even more difficult to find the money to pay for it.
If you suspect that you may need to put a parent into a long-term nursing home, it’s a great idea to create a plan for saving. Planning in advance can give families an opportunity to protect the savings you already have, while figuring out how to invest for your future needs.
Dementia and Other Illnesses
Dementia is a debilitating disease that is difficult to care for, especially if the child of the sick parent is still working. Often, it requires a full time caregiver, if not moving the parent into a special facility. Both of these costs can add up quickly. If you plan quickly after the diagnosis, there’s an opportunity to get the parent’s input while they’re still lucid. But sometimes, what the parent wants isn’t always the most feasible course of action.
Some agencies that focus on aging, non-profits, and eldercare attorneys can all be resources for you.
It’s difficult enough to save for your own retirement—it gets all the more complicated when you factor in how much it might cost to help your aging parent.
If your parents are still lucid and capable of taking care of themselves, talk to them candidly about their wishes and their finances. Consider speaking with a financial planner who can help make sure that—if and when the time comes—the right amount of money is there to help. You may also consider a life settlement, where your parent can sell a life insurance policy and receive a lump sum of cash that can help alleviate some existing financial struggles.