Long-term care – the costs you never thought of

Question: My parents are aging and my dad is sickly. They’re OK now, but I can see the day when Dad is going to need more care than Mom can give him. We may hire someone to help her so we don’t have to go to all the expense of a nursing home. Besides, Dad prefers being at home. But that may not always be an option. What do we need to be thinking about to prepare for the next step?

Answer: Long-term care is expensive. And sometimes it costs a lot of money, too.

Though there may not be a great deal of cash changing hands as a result of your father’s gradually increasing need for long-term care, that doesn’t mean a steep price is not being paid. It just sounds to me as if your mother is paying the bulk of that price now.

I am not talking about a financial price. It’s a physical, psychological and emotional price. I doubt she begrudges her role – if she is like most women her age I’ve met, she wouldn’t dream of allowing anyone else to take the role of primary caregiver to her husband.

In her day, when they said “for better or for worse” and “till death do us part,” they meant it.

But please, watch her carefully. She may literally work herself to death caring for your father, and that wouldn’t be good for him, much less for her.

In addition to the physical, emotional and psychological costs associated with long-term care giving, there are financial costs. But it often comes as a surprise how these various costs compare to one another.

You mentioned hiring someone to help your mother. Great idea. If Mom just needs some extra help around the house for a few hours a day, you might get away with paying someone $10 an hour for 20 hours per week. Let’s call that $800 a month. Not chump change, but if it gives Mom a break it can be worth every dime.

I hate to say this, but these situations rarely stand still – they move in one direction or the other. To be blunt, the likelihood is that your father will either die or continue declining. He is unlikely to simply remain at his present level of health.

So, fast forward a year or two. Imagine that you don’t need care-givers for four hours a day, but 24-hours a day. Assuming the same hourly pay rate, that comes to $87,600 per year. And my experience is that once you get to that level, $10 an hour won’t cut it. You’re probably looking at $15 an hour, or about $130,000 per year.

Many are surprised to learn that a nursing home is not the most expensive option, but often the least expensive option for someone needing full-time, round the clock care.

In the abstract, before they experience a day, week or month of round-the-clock care giving, I’ve heard well-meaning adult children say, “I’m never going to let Momma go into a nursing home.”

I understand the emotion behind that statement, but it is a foolish promise to make. You just do not know what the future will bring.

So what can be done at your stage?

Honest conversations. You need to have a very honest conversation with your mother and father about where they are now and what their wishes are. Be frank with one another about the state of their financial, physical and emotional resources. It’s their money and their lives, so you’re in no position to dictate anything. But most parents have a strong urge to “not be a burden” to their children, and are interested not only in their own well-being, but also that of their off-spring.

Holistic planning. Work with an elder-care attorney to explore any options for financial assistance available to you. Very few people have a grasp of what resources are available and when one might qualify for those benefits. An experienced elder-care attorney can be very helpful in educating you about your options. The services of a financial advisor may also be helpful, not as a replacement for, but a supplement to the primary work of an elder-care attorney.

A word of caution: as people age, often their capacity to make difficult decisions declines as well. The default mode of “do nothing and hope for the best” can kick in.

So the most helpful thing you may be able to do for your mother and father at this point is to prod them into action. Initiate that honest conversation. Set up a meeting with an elder-care attorney.

Those would be meaningful first steps in the journey on which you are embarking, of giving care back to your own parents.

Byron R. Moore, CFP is managing director / planning group of Argent Advisors, Inc. Email him at bmoore@argentadvisors.com.