Practical ways to approach sharing parents’ long-term care expenses
By Bruce Horovitz, AARP – January 24, 2023
Jaclyn Strauss has four words of advice for siblings who want to share the costs of parental caregiving: play to your strengths.
That’s precisely what she and her brother have done in preparation for what they both know will be substantial caregiving costs for their 78-year-old father living in Tampa, Florida. Even though his caregiving needs have started out relatively small — with a paid aide just a couple of hours a day for home care — the siblings have been preparing for this moment for several years, with regular communication and digital transparency of all their parents’ important documents and paperwork. Their mom, a 72-year-old retired schoolteacher, has not needed long-term care, but is too physically and financially stretched to care for her husband.
Never mind that Strauss, who is a 43-year-old CPA in Fort Lauderdale, Florida, and her 40-year-old brother, who is a physician in Tampa, fought like cats and dogs during their youth. They are now very close, she says. And each has embraced their chief asset in the new caregiving duties that now require financially assisting their folks.
“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 brother and I don’t have,” says Strauss, a founder of 2nd Vault, a digital company that organizes and stores important documents and information. “We approached this by first asking ourselves: ‘What are the strengths that each of us brings to the table?’ “
As the baby boom generation continues to age, this issue — how to both fairly and amicably split caregiving costs among siblings — will only grow. Roughly 70 percent of people over age 65 will need some form of long-term care before they die, according to an analysis by the Urban Institute. And many have not saved enough for that care. A 2021 AARP report found three-quarters of the family caregivers surveyed spent an average of $7,200 annually on out-of-pocket costs toward a loved one’s expenses on everything from housing and medication to adult day care.
Here is how financial planners and a caregiving specialist advise siblings on how to best walk this often prickly financial walk.
1. Acknowledge the challenge
A critical first step is to simply acknowledge and validate how difficult long-term care is for all involved, says Marguerita Cheng, a certified financial adviser in Potomac, Maryland. Not only is it difficult for the parent, but it’s also difficult for siblings who are trying to support long-term care emotionally and financially.
2. Get access to all documents
Among the first things for siblings to do is to gather their parents’ financial documents to figure out their financial situation, says Danielle Miura, a certified financial planner in Ripon, California. “There will often be money somewhere that you least suspect,” she says.
3. Get to know professionals
To accurately access the financial support your folks may need, siblings need access to the financial and non-financial professionals who support the parents, including financial planners, accountants and estate attorneys, says Strauss. She and her brother both have power of attorney, and know the experts their parents rely on.
4. Seek professional advice
It might be worth meeting with an elder care attorney to discuss possible Medicaid qualifications and how to structure the financial document to make sure your parent can qualify, says Miura. That may require using up the parents’ assets first, she says.
5. Schedule regular meetings
While it’s not always possible to have these meetings in person, at least the first should be, says Linda Abbit, caregiving specialist and author of The Conscious Caregiver: A Mindful Approach to Caring for Your Loved One Without Losing Yourself. After that, meetings can be held via Zoom or on the phone, and everyone should have a say about what they feel comfortable contributing. The meetings should have a regularity to them and everyone — including the parents — should attend, if possible, she says.
6. Acknowledge that financial contributions vary
Because time is money, financial contributions from siblings can vary, says Sandra Adams, a certified financial planner in Southfield, Michigan. Everything from caregiving to providing transportation to paying bills has a financial cost and should be “equalized” in the end, she says. Since Strauss has considerably less income than her brother, she “pays” more with her time — by organizing the care and running errands with and for her folks.
7. Accept that some siblings may refuse to help
If a sibling doesn’t want to financially participate in any way, offer them a list of other ways to help, such as running errands. If they still refuse, don’t waste more of your own time or energy fighting with them, says Cheng.
8. Consider hiring a mediator
If paying the costs of long-term care for a parent gets contentious among the siblings, consider hiring an elder care attorney or elder care social worker to mediate, says Cheng.
9. Document everything
One sibling should oversee keeping all documents and receipts — maybe even creating spreadsheets — that highlight all costs related to long-term care, says Miura. This should be available for all siblings to see.
10. Remember the loved one
In the end, what’s most important are the wishes of the parent who needs long-term care. “It’s about them being safe and comfortable,” Cheng says.
How One Family Made This Work
Five siblings, four in-laws, one mother, age 92. Somehow the 10 of us navigated an unexpected need to move our mom to a new living situation and we’re all still speaking. It took video calls, regular group text updates and honest airing of who could do what, when and how — now and in the future.
I am the eldest of five; my two sisters, two brothers and I have been spared the big challenges that come with caregiving for aging parents. But when mom’s landlord decided to sell the condo she had rented for 10 years, it was time to consider living and care options for the years ahead and to do it quickly. A few decisions helped us smooth the process.
- Mom’s desires trumped all. Our mom is as sharp as ever, and she was clear: She wanted a community in which she could move from independent to assisted living if necessary and wanted amenities to encourage social life. She had a place in mind in the neighborhood where she had lived for 40-plus years.
- We used available tools to communicate. We siblings had three Zoom calls to review potential places and we regularly texted as we went forward. We agreed on what we wanted for mom: safety, comfort, care, community, affordability and proximity to my youngest brother’s family. Communication helped us stay on the same page and keep a needed sense of humor.
- We respected each other’s expertise. Two siblings are retired financial executives; another is a facilitator by training. That helped us agree on money matters, for example. But everyone had something to ease the process and we used it.
- We talked about tough topics. Money talk — about our own and Mom’s — was necessary here. First, we agreed to use her money first. When that runs out, we will supplement monthly what is needed beyond Medicaid and Medicare. Because our income levels vary, we all will pay what we can, but we set an ideal monthly number.
- We tossed the crystal ball. Mom is happy in a one-bedroom unit in a retirement community less than a mile from her former place. We are happy with it too; we just wish it was closer to the family in town. Of course, we can’t know what the future holds, but we can prepare. To that end we set up an account and are paying a set amount monthly to be ready for Mom’s next need, whatever it may be.
Lorrie Lynch is a freelance journalist and former features editor for AARP.
