If you’re like many baby boomers, you’re facing financial challenges on all fronts. You may have adult children who are in college, or maybe even have graduated, but still require financial assistance. You might be struggling to pay off debt that you accumulated in your younger years. And there is always the ever-present challenge of saving for retirement.
A growing number of baby boomers are also faced with a relatively new challenge: supporting their elderly parents. According to research from TD Ameritrade, 25 percent of baby boomers provide support to some adult, usually either a parent or a grown child. Approximately 8 percent of that support goes to elderly parents.1
Your parent may not have the assets or income to live comfortably in retirement. Or they may require long-term care or in-home assistance that they can’t afford on their own. Support doesn’t even have to come in the form of money. You might be one of the 65 million Americans who serve as “free” caregivers. That “free” care equates to about $375 billion per year in value.2
Regardless of whether you support your parent with money or with your time or both, you are likely feeling the costs of that support. You may be dedicating money to care that otherwise would go in your retirement accounts. Or you may be forced to work less so you can provide care for your parent.
Clearly, you want to take care of your parent, but you also have to be careful to protect your own financial stability. After all, you probably don’t want to be dependent on your kids in your advanced years. Below are a few tips to help provide for your parent while also continuing to save for retirement.
Set limits on your support.
It’s natural that you want to care for your parent. However, that care and support shouldn’t be an open-ended obligation. Set a firm line on what you can and cannot do. For example, you may state that you will pay for some bills, but you won’t reduce your savings level or dip into your savings. You may offer to provide care, but only for a limited number of hours per week.
Then tap into other resources to fill in the gaps. Perhaps you have siblings or other family members who could pitch in. You also may want to check with senior services organizations in your area. They may offer adult day care, food delivery or even volunteers who provide friendship and companionship.
Define an end goal.
One of the challenges with supporting an elderly parent is that it’s an obligation that’s difficult to plan around. You don’t know when their condition will change or improve, and you can’t predict when your support will end. That level of uncertainty is tough to manage.
Talk to your parent about their long-term goals, and also communicate why you can’t provide support indefinitely. Ask them what long-term outcome would be acceptable. Could they consider an assisted living facility? What about hiring an in-home aide?
While your support may be helpful now, it shouldn’t be a permanent strategy. You have your own goals to focus on.
Take care of yourself.
Finally, it’s important that you also take care of yourself in addition to supporting your parent. Find time to do the things you love. Spend time with your kids and other family and friends. Make sure you’re not sabotaging your own career.
You don’t want your final months or years with your parent to be full of resentment and ill will. You don’t want them to be a burden on you. Protect yourself and your mindset by taking breaks. If you do that, you may be able to think more clearly and make more informed decisions.
For more information, contact us at Lighthouse Financial in Rocklin, California. We help families solve their most pressing financial challenges. Let’s connect soon and examine your needs, objectives and goals.
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