Aging Gracefully
A recent survey of adults showed that every one was growing older, dealing with aging parents or both. That means that every person must deal with financial issues concerning aging. Those who have read these pieces before know that it is unlikely that most folks will have enough money to just pay someone to take care of everything so we need a better plan.
We all need to designate someone to take care of our affairs when we become unable to make financial decisions. Aging parents must be encouraged to make that designation. Next, everyone needs to have a folder with that person’s name and the date on it. That folder should contain a will, insurance policies, Social Security files, retirement account reports, tax returns and other information needed to handle finances. If you are older than 65, or have parents older than 65 and cannot find that folder, someone is not being responsible. The file will require annual updates.
The document that gives someone control is usually called a Power of Attorney (POA). That POA should be in the folder, and other family members should also have a copy.
This is not a death issue. This is about living past the point of being in control. Someone may be making Medicare decisions for us. Someone may be trying to pay a $4,000 nursing home bill with a $1,400 Social Security check. Is there a budget for those days? Being in charge of an aging person’s affairs is very difficult. The Social Security Administration doesn’t acknowledge a POA and isn’t particularly impressed with real attorneys. The complexity of Medicare Part B insurance and “donut” coverage are more than the average person would ever voluntarily master and banks and insurance companies routinely challenge financial custodians hoping to squeeze one more dollar out of a puzzled caregiver.
The Budget Doctor’s prescription for dealing with aging:
1. Identify a person you trust to make important decisions about your life. It doesn’t have to be a spouse or relative, just someone you really trust who, ideally, is at least ten years younger than you. Add that person to your checking account so they can check your affairs and pay for emergencies if needed. This person may decide to take over your affairs, so choose carefully. You may want to make similar arrangements for health issues, but that is another paper.
2. Write directions for old age events including nursing home preferences, charity donation preferences and so forth. Include this in your folder.
3. In addition to giving the person you have selected all this material, consider giving a copy to someone else just in case something happens to your designee.
4. Spend at least one hour at www.medicare.gov and at www.ssa.gov. Understand the complexity of dealing with the government.
It is not often that an elderly person will admit to losing capacity and simply accept another taking over financial affairs. This, like giving up a driver’s license, represents a step towards feeling like less of a person. It needs to be arranged so that it is not the decision of that aging person but rather someone who can be totally objective yet caring.