The time to start thinking about your parents’ finances is not when they are ill or when they have to move into an assisted living center. The time to start is when everyone is healthy and alert. Start talking to your parents about estate planning, health care power of attorney, and other financial matters before things are in an urgent state of affairs and you have to make quick decisions.
If you are able to have discussions at your leisure, when everyone can take time to contemplate decisions, the hard questions are easier to answer. So start talking early and consider these estate planning strategies.
- Have your parents decide on their health care directives. They should have a living will or advanced health care directive that specifies the types of life-sustaining treatments they wish to have taken on their behalf. Include in this discussion the creation of a healthcare power of attorney. This will authorize someone in the family to make medical decisions on their behalf if they are unable to do so. They should also communicate their wishes to other family members so everyone is on the same page.
- Have your parents select a durable power of attorney. A durable power of attorney acts on their behalf to handle all financial matters, including paying bills and handling assets, should your parents be unable.
- Ensure your parents have a will or living trust that is up to date.
- Ensure that you and other family members know the location of all important estate planning records and that you have the keys to safe deposit boxes and know all computer passwords.
- Consider purchasing long term care insurance and discuss what the role of a caregiver will be should one be needed.
Having these discussions while everyone is healthy and alert is much easier and eases the stress of having to make decisions when a parent has fallen ill.