The Best Ways to Split Caregiving Costs
Play to your strengths is Nancy’s first advice for siblings who want to find the best ways to split caregiving costs.
That is exactly what she and her sister have done to prepare for the significant caregiving expenses they both anticipate will incur for their 78-year-old father who resides in Oregon. The siblings have been preparing for this time for several years with regular communication and digital transparency of all their parents’ important documents and paperwork, even though his caregiving needs initially started out relatively small — with a paid aide providing just a few hours per day of home care. Although their mom, a retired nurse of 76 years old, is too exhausted physically and financially to care for her spouse, she has not required long-term care.
It doesn’t matter that Nancy, an accountant from Portland, and her 40-year-old sister, a doctor from Medford, used to fight like cats and dogs. She claims that they are now very close. And each has accepted their greatest strength in the new caregiving responsibilities that now necessitate helping their parents financially.
According to Nancy, “In my profession, I hear about all the infighting and resentment that siblings can have towards each other in this process — and that is exactly what my sister and I don’t have.” “In order to approach this, we started by identifying the strengths that each of us can contribute to the table.
This problem—how to fairly and amicably divide caregiving expenses among siblings—will only get worse as the baby boom generation ages. According to a study by the Urban Institute, about 70% of individuals over 65 will require some kind of long-term care before they pass away. And many people do not have enough savings for that treatment. According to an AARP study from 2021, 75 percent of family caretakers pay out-of-pocket expenses for a loved one’s costs for everything from housing and medicine to adult day care, amounting to an average of $7,200 per year.
Here are some tips that financial advisers and a caregiving expert have for siblings on how to navigate this frequently rocky financial terrain.
1. Recognize the difficulty
According to Marguerita Cheng, a certified financial adviser in Potomac, Maryland, the most important first step to split caregiver costs is to simply recognize and validate how challenging long-term care is for everyone involved. Not only is it challenging for the parent, but it’s also challenging for relatives who are attempting to provide both an emotional and financial support system for long-term care.
2. Access all of the papers
Gathering their parents’ financial records to assess their financial position is one of the first steps for siblings, advises Danielle Miura, a certified financial planner in Ripon, California. She predicts that money will frequently be found in unexpected places.
3. Meet industry experts
According to Nancy, siblings must have access to the financial and non-financial experts who assist the parents, such as financial planners, accountants, and estate attorneys, in order to correctly access the financial support your parents may need. She and her sibling each have power of attorney, and they are familiar with the professionals their parents hire.
4. Ask an expert for guidance
Meeting with an elder care lawyer to talk potential Medicaid eligibility and how to structure the financial document to ensure your parent can qualify might be worthwhile, advises Miura. She says that might mean spending down the folks’ assets first. You might also talk to various home care companies to see what they can offer. A HomeCentris Client Relationship Manager can help you understand the options available for you and your loved ones.
5. Plan frequent gatherings
Although it may not always be feasible, the first of these meetings should be in person, advises Linda Abbit, Author of The Conscious Caregiver: A Mindful Strategy to Caring for Your Loved One Without Losing Yourself and expert in the field. After that, meetings can be conducted over the phone or via Zoom, and everyone should be given the opportunity to contribute what they feel comfortable doing. She advises that everyone should attend the meetings, including the parents, and that they should be held on a frequent basis.
6. Recognize that various financial donations are made
Financial contributions from siblings can differ because time is worth money, according to Sandra Adams, a certified financial planner in Southfield, Michigan. Everything has a financial expense, including providing care, paying for transportation, and paying bills, and should ultimately be “equalized,” according to her. Nancy “pays” more with her time because she makes significantly less money than her sibling.
7. Recognize that some siblings might decline to assist.
Offer a list of alternative ways to split caregiver costs if a sibling declines to contribute monetarily in any way, such as by running chores. Don’t waste any more of your time or energy arguing with them if they continue to reject, advises Cheng.
8. Think about using a referee
If the siblings disagree about who should foot the bill for a parent’s long-term care, Cheng advises hiring a senior care lawyer or social worker to mediate.
9. Keep track of everything
According to Miura, one sibling should be in charge of keeping track of all paperwork and invoices, possibly by making spreadsheets that list all expenses associated with long-term care to ensure you split caregiver costs fairly. All the kids should be able to see this.
10. Consider the Family Member.
The desires of the parent who requires long-term care are ultimately most significant. It’s important for them to feel secure and at ease, adds Cheng. 7. Recognize that some brothers might decline to assist. Offer a list of alternative ways to help if a sibling declines to contribute monetarily in any way, such as by running chores. Don’t waste any more of your time or energy arguing with them if they continue to reject, advises Cheng.
HomeCentris Can Help.
Planning for the inevitable can be a frightening experience, but the more pre-planning you can do, the better. Understanding your options before an accident or hospitalization can make this journey less frightening, less chaotic, and better for all family members. To talk to a HomeCentris office near you, contact us today and we’ll do our best to discuss the various home care options and funding sources available to you and your family.