Helping aging parents stay active and healthy at home can be achieved with careful planning. The rewards of personally caring for, or managing the care of, a loved one who needs help are innumerable. It’s an opportunity to give back and to offer a return on the loving investment they once made in us. The trade-off is that in-home care costs money; money that may not be available.
In-home care may be provided by loved ones, family, friends, neighbors or professional caregivers. It typically includes assistance with activities of daily living — bathing, dressing, toileting, eating and walking — as well as companionship, medication reminders, laundry, light housekeeping, errands, shopping and transportation.
If your parent is under a doctor’s care because of a recent illness or injury, home healthcare companies can provide skilled nursing services in their house, such as physical therapy, wound care or speech therapy.
Whether caregiving services are provided by a professional or family member, either option can impact your family’s finances. An eight-hour-a-day, five-day-a-week professional caregiver costs about $40,000 a year, while 24/7 care can be as much as $150,000 a year. If a parent depends on family for care, it can take that caregiver away from his or her job and earnings, affect business opportunities and reduce future Social Security income.
Medicare, the federal government’s health insurance program for people aged 65 and over, covers some home health care if prescribed by a doctor, but not home-delivered meals, non-medical home care, or 24/7 care. Medicaid, a joint federal and state program that helps with medical costs, has very low asset and income restrictions.
Depending on where your parent lives, they might qualify for a Medicaid waiver that can help with in-home care costs. Doug Lueder, owner of Prosper Home Care, an independent home care agency based in Atlanta, says, “The purpose of the (Medicaid) waiver program is it can help individuals stay at home in a healthy, safe environment for the same amount of money or less than it would cost for that person to be in a facility. States would rather be able to keep people at home, and in general statistics show people are happier and they have better outcomes at home.”
Another possible source of funds may be your parents’ home. For many Americans, the equity they have built up in their homes is their single largest financial asset, typically comprising more than half of their net worth.
Older homeowners can access their equity by selling their house and moving into a less expensive, more manageable, place to live and then use the leftover proceeds to pay for professional care.
For those who would rather stay in their current home, as most people would prefer to do, options include a home equity loan, home equity line of credit, or a reverse mortgage.
With a reverse mortgage, borrowers have the flexibility to use their loan proceeds however they wish, including to pay for in-home care or other medical expenses. As long as the terms of the loan are met, the balance doesn’t need to be repaid until the last surviving borrower has passed away or permanently left the home. To learn more about this option, visit the National Reverse Mortgage Lenders Association’s consumer education website www.reversemortgage.org/adultchildren.
If you care for a loved one, consider following these tips from the Family Caregiver Alliance, the nation’s oldest nonprofit organization dedicated to helping families prepare and cope with caring for loved ones at home.
First steps for new caregivers
* Identify yourself as a caregiver to your loved one.
* Get a good diagnosis — from a specialist or geriatrician if necessary — of your loved one’s health condition
* Learn what specific skills you might need to care for someone with this diagnosis. Caring for someone with dementia is different from caring for someone with chronic heart disease.
* Talk about finances and healthcare wishes.
* Complete legal paperwork, e.g., Powers of Attorney, Advance Directives.
* Bring family and friends together to discuss care.
* Keep them up to date on the current situation.
* Identify resources, both personal and in the community.
* Find support for yourself and your loved one.
* Remember, you are not alone.
Most importantly, remember that taking care of yourself is as important as taking care of someone else.
First steps are from the fact sheet Caregiving 101: On Being a Caregiver ©2016, published with permission from Family Caregiver Alliance, www.caregiver.org.