As baby boomers transition into retirement and their golden years, their adult children are becoming caregivers and counted on to provide financial support. More than 32 percent of adult children helped out with $5,000 or more of their parents’ expenses in the last year, and more than 75 percent are concerned about the impact it could have on their own financial stability.
Savings have been hit hard because of the sagging economy, investment losses, and depressed home values. Complicating matters is sky-rocketing health care costs associated with Mom or Dad’s long-term care. An experienced elder law firm can help preserve assets, connect with government benefits and resources, and create a contingency plan to address possible changes.
As you explore options on how to best take care of your parents, it is important that you understand the legal implications of your good intentions. A false step could result in lost Medicaid eligibility, adverse tax consequences, or any number of other legal or financial problems. Discussing your situation with an elder law attorney should be the first step you take in helping your parents safely navigate the complex legal and financial issues associated with caring for them.
Families oftentimes rely on bad advice from family members, their financial advisor, accountant, or even their attorney, when developing a financial plan to care for an aging parent. Take for example the case where an elderly parent builds an apartment on a child’s property so that he or she can be closer to family. The money spent by the parent to build the apartment could be interpreted as a gift that could result in lost Medicaid eligibility and gift taxes.
People are beginning to understand the importance of involving an experienced elder law attorney early in the retirement and long-term care planning process. Nothing should be taken for granted. You should not make the mistake of relying on common sense to the exclusion of good legal advice.