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Use these 4 tips to prepare for the costs ahead of time
In the United States, nearly 44 million adults provide assistance to family members with disabilities or other care needs.
Further research shows nearly half of family caregivers spend $5,000 a year on caring for their loved ones, while 30% spend $10,000 or more. Planning for the care of aging parents—and the associated costs of care—is critical for their protection, as well as your own.
In Jacob Davidson’s Time.com article, “4 Ways to Cope with the High Cost of Caregiving,” Andy Cohen, CEO of Caring.com, offers these tips:
Cover expenses with your parents’ money first. Depleting your parents’ assets first helps reduce the overall value of their estate, which may lower potential estate taxes in the future*. Plus it may help them qualify for Medicaid benefits faster.
Don’t overlook benefits. Tools such as the U.S. Administration on Aging’s Eldercare Locator and the National Council on Aging’s Benefits Check Up can help you find local programs and services available to your parents.
Look at your own benefits, too. If you work for a company with 50 or more employees and have been on the job for at least a year, you should be eligible for the Family Medical Leave Act, which allows you 12 weeks unpaid leave to care for a loved one.
Talk with your loved ones—sooner rather than later. Discuss their wishes and the financial preparations needed. Be sure they have estate-planning documents such as power of attorney, health care proxy, and living will in place. “Making arrangements that will enable you to care for your elders both medically and financially, if that becomes necessary, should give peace of mind to everyone,” writes Davidson.
*Consult your tax advisor for more information.
