Joining Households with Aging Parents? What to Consider
November 12, 2014 | Home and Family
Ruth Lassman was a working nurse in 2006. She was also a single mom of two young girls. That year, her active 71-year-old mother was devastated by a stroke. When her mother was due to leave the hospital, plans for an in-home care worker fell through, and Ruth made a choice that came from her heart. “I felt that my mother would recover better if she was in her own home; and when our home care plan fell apart, I did what I felt I should do as a daughter. I decided to be her caregiver.”
It’s a decision a growing number of people are faced with today. In order to make the best of such a situation, it’s important to consider some factors. “This is a big life decision for everyone involved, and family members have to be able to talk through all of the issues,” says Polina Engel, a senior attorney for Advanced Planning at Northwestern Mutual. “Some parents and children may not have ever talked about things like end-of-life decisions or about their individual financial situations, let alone household living styles. If you are going to move into the same home, it’s best that it all gets talked out before houses are sold and keys are exchanged.”
The Big-Picture Concerns
If you are considering moving your parent(s) into your home, or your family into theirs, you’ll want to think about all the practical and emotional decisions up front. To begin, you should think through some basic questions for you and your own family:
- How might this change your house and family life?
- How well do you get along with your parent? Can you get past old grievances or bad relationship patterns?
- If you have children, how will this affect them?
- How will this affect your work life?
- How will this affect your current financial situation and your future?
- Will you have to make modifications to the home?
- If your parent needs special care, who will give that care?
- How involved will your siblings be in providing care or pitching in financially?
- Will you have a support network when you need it?
- How much can you really give? What might be too difficult for you or your family to handle?
For Lassman and her family, the amount of care her mother needed had a large impact on their lives. In her case, it made more sense to move her family into her mother’s home and rent out the townhouse where she had been living. “One thing I wish I had done in advance was consider how this might affect my girls,” she admits. “My oldest was 10 when we moved in, and she says she didn’t mind sometimes helping with caregiving duties because she got to know her grandmother better, but I worry that was a burden she took on at a young age.”
Lassman also says she wishes she had taken into account her own emotional and physical needs when deciding to take on the bulk of her mother’s medical care. “I am a registered nurse, but sometimes it still overwhelmed me,” she recalls. “My oldest daughter ended up acting almost as a second caretaker at times.” Despite her training as a nurse, the heavy-duty care her mother needed and the lack of additional help resulted in her sustaining an injury from all the lifting and physical labor. After six years of caring for her mother, Lassman needed to transition her mother to a care facility.
Experts say if you will be taking on a parent who has significant health care needs, it is imperative you seek support. There are several websites that explore the issues of in-home elder care and provide links to resources like Caregiver.org and Agingcare.com, which has this e-book available online.
Think About Money Matters
The financial concerns of combining households can be more complex than some might initially think. You and your whole family will have to decide who will be responsible for those costs and how money issues will be managed.
Some areas to consider include:
- What financial resources do your parents have available? What debts?
- Will they pay rent? Will they contribute to other household expenses?
- What insurance is available for care?
- What kind of benefits do your parents receive?
- Who in the family will help your parents manage their finances?
- Will you continue to work? Will you need to reduce work hours?
- Will siblings pitch in with care and/or financial help?
- If you have to make modifications to your home, who will pay for that?
- How will medical and health care costs be paid for?
- How much can the adult children contribute to their parents’ care without hurting their own future?
Engel says it’s important for the parents and the adult children to sort out specifics in advance. “You’ll want to determine resources and who will be responsible for which costs,” she says. “It is also a good idea to draw up a contract for any rent being paid or cost-sharing to ensure everyone knows what to expect. This is also useful for tax purposes and for other legal and benefit consideration.” These decisions affect not only the taxes of everyone involved, but it could also affect your parents’ benefits.
“I also advise people to look at their own financial situation,” says Engel. “It is important that they are saving for their own retirement and health care needs.” A 2007 study conducted with the National Alliance of Caregivers showed 34 percent of caregivers dipped into their own savings to help take care of their loved one, and 37 percent quit their jobs to give care, resulting in lowered income and savings for themselves.
In Lassman’s case she admits her decision to help her mother has cost her financially in many ways. Her mother did not plan for her long-term care needs, and Ruth quit her job to care for her mother. “At the time I was making the decision, I wasn’t thinking about my own retirement. I was thinking about my mother and what was best for her,” she says. “If I could do it again … I would have found some overlapping care help so I could work to keep outside income coming in.”
In addition to drawing up a contract for any rent or cost-sharing agreements, you and your parents will want to get some other legal paperwork in place to ensure all health care and estate issues are put in order. Again, experts suggest it is best that the whole family is brought in to these conversations to be sure everyone understands the decisions being made and so conflicts can be avoided down the road.
Among the documents you’ll want to have in place are:
1. Financial Power of Attorney. This will allow whomever the parents designate to deal with their legal and financial matters.
2. HIPAA Authorization. This will allow doctors and other medical professionals to share a parent’s medical information with a selected representative.
3. Advanced Health Care Directives.
- Living Will: This gives direct guidance to medical professionals about medical preferences and end-of-life care when the parents can no longer communicate for themselves.
- Health Care Power of Attorney: Some people may choose to leave these decisions to their caretaker, using a Health Care POA. Having one of these in place also allows the caretaker to make decisions about issues that may not have been addressed in a living will.
4. Will. It is important to update the parents’ wills to reflect any financial agreements made as a result of combining households. Some may choose to change allocations from their estate to compensate the caregiver.
“If I was giving people advice, I’d tell them to be sure they reach out for help and to have a support network that can give them respite. You need your own time to take care of yourself,” advises Lassman. Despite the challenges to her own physical and financial well-being, she says she would still make the same decision to combine homes with her mother. “Being with her for those years and caring for her was important for all of us—my daughters, too. I was glad I was able to be there for her when she needed me, and I know it made a difference for her.”