They say we get wiser as we get older, and that may be true. But let’s face it: Many new uncertainties and challenges can crop up as people get deeper into their golden years. Changes in physical health and issues with memory can mean you—or your elderly parents— might require new types of never-before-needed assistance.
For example, you might need guidance and help with basic day-to-day home tasks—from cleaning the house and climbing stairs to getting to the store for groceries. Likewise, there could be concerns to address with financial matters ranging from ensuring bills are paid to avoiding excessively risky investments to preventing scammers from stealing assets from you or your elderly loved ones.
With that in mind, here’s a look at two key issues that may impact your life or the lives of your elderly parents—aging in place, and safeguarding wealth from costly cognitive mistakes.
There’s no place like home
More than 75 percent of Americans age 50 and older want to stay in their current homes and communities as they age instead of moving to a nursing home or elsewhere, according to AARP.1
But wishing doesn’t make it so. To potentially make that happen for you and your spouse or for your parents (or all of the above), you need to plan and take action steps—with the same level of seriousness that you plan for your financial future.
According to Kim Evanoski, CEO of care management company Care Manage for All, some of the key issues surrounding the idea of aging in place include the following:
1. Needs. For a price, you can get almost any type of in-home help—so you’ve got to identify the big needs and pain points to address. If you’re helping your parents, talk with their doctors about specific ways health problems could reduce their mobility or their ability to take care of themselves. If you’re planning for yourself, think about any illnesses that you or your spouse have or that run in your families—and how those illnesses tend to impact the ability to do certain things. Also, honestly examine your own health history, lifestyle choices and risk factors. That assessment should help you see whether you (or your parents) will potentially need help with personal care, transportation, meal preparation, household chores, mobility inside the home, health care or a combination of services.
2. Changes and renovations to the home. Often, aging in place successfully requires maximizing the usefulness of the current house and making it safe and comfortable at any age. Here are just a few of the common steps to help make that happen:
- Swap out existing hardware. Replace knobs with lever-handled doorknobs, which are easier to open, and add sturdier handrails along stairs. In bathrooms, install grab bars, single-handled faucets and “comfort height” toilets. In the kitchen, add rollout shelves and better under-cabinet lighting.
- Widen doorways. A door opening of at least 32 inches allows better access for people using walkers or wheelchairs.
- Create space where possible. An open-design household allows for easier and quicker movement, presents fewer hallways and doors to navigate, and provides more flexibility in furniture layout. In addition, sliding walls can open up options that allow many uses for a single room.
- Focus on the first floor.For example, avoid stairs by having the main bedroom on the first floor. Adding a walk-in shower on the main floor of a house can also benefit older people in poor health.
3. Keeping social connections intact and strong. While stairs can be challenging for many seniors, depression and other health issues associated with loneliness and isolation can be much more serious problems. Ask yourself how aging in place will impact social connections—yours or, if you’re helping your parents age in place, theirs. You might find, for example, that it makes sense to hire someone to drive your octogenarian parents to movies or dinners so they stay connected with themselves and others. Some services will even drive people in their own vehicles.
Likewise, part of your planning should determine whether local area friends are in good health and likely to be alive for many years—as well as whether those friends are planning to stay in the same geographic area during their later years. If you discover that most of your widowed mom’s friends are moving south to warmer states, aging in place could actually negatively impact her overall health rather than improve or maintain it. One way to combat that situation is to work with home care providers that can offer activities such as reading groups and art lessons. “If you can’t get yourself or a loved one to social environments outside of the home, look for ways to bring social interactions to them instead,” says Evanoski.
Safeguarding financial well-being
As we age, we may find that the biggest risk to our financial health isn’t a market crash—it’s our own behavior and choices. So says Chris Heye, co-founder of Whealthcare Planning (www.whealthcareplan.com), a firm that offers a cloud-based platform that helps older adults and their families more effectively prepare for the financial challenges of aging.
That’s because our cognitive abilities tend to decline over time, and the risk of dementia rises as we get older. According to the World Health Organization, the number of people living with dementia worldwide is expected to nearly triple by 2050.2
But you don’t need a diagnosed illness to make harmful financial decisions. Various mental and physical health issues can diminish people’s ability to make prudent moves with wealth, thereby putting them and loved ones at risk, financially. Some of the dangerous outcomes Heye sees include the following:
- Investing impulsively. Aging can reduce our ability to accurately assess risk as well as our ability to control our impulses. That, in turn, can lead people to buy investments that are far too volatile for their risk tolerance based on their needs and their age. Or it might prompt money moves they’d never normally consider. Heye notes the example of an elderly man who sold his entire portfolio and reinvested the money in just one stock.
- Falling for financial scams and exploitation. Behavioral factors such as loneliness can make people—even highly intelligent and financially savvy people—susceptible to financial scams. Such scams sometimes involve investment “opportunities” that don’t exist or that make wild claims. But they also involve scams in which widowed or divorced adults are victimized by thieves who feign romantic interest in them.
So how can you help an aging parent or parents avoid these scenarios? And just as important, what can you do to prepare yourself so you avoid making major money mistakes as you get older? Consider these action steps:
1. Plan now. If you’re in your 40s, 50s or 60s, make a plan for how and when you want to transfer decision-making powers to heirs or others. Rather than base that transfer on a specific age, make it dependent on your level of cognitive health—using tests that assess your decision-making ability. If you’re concerned about your elderly parents, help them take such tests.
2. Get documents in order. Make your wishes and plans formal via a will, a living will, power of attorney and other legal documents. You can also create documents that spell out certain guidelines—such as family agreements that explain how and to whom you will lend money. Investment policy statements that detail exactly how you want your investment portfolio to be allocated can also be useful in ensuring your finances aren’t put in jeopardy.
3. Communicate with financial advisor(s). Get to know your parents’ financial advisor(s) so you can set the stage for dealing with potentially difficult conversations and challenging situations. You may end up coordinating efforts down the road, so build relationships with these key professionals now.
4. Watch for warning signs. Our ability to plan, organize and control our impulses— known as executive function—is an important indicator of our capacity to make prudent decisions. If a parent or spouse is acting impulsively with money or in other ways, that’s a possible sign of deteriorating executive function.
As noted above, loneliness can also put older adults at risk. If an older family member reports having conversations with “new” people whom nobody knows, action should be taken immediately to investigate the nature of these discussions. It could indicate that exploiters are making inroads into the family member’s life. Finally, watch for signs of extreme memory loss that impacts regular tasks—which suggests that the ability to make good financial decisions may be waning.
Take action now
It’s much better to plan and take helpful steps early—before there are issues or emergencies that force you to react. That’s true whether you’re helping your parents or thinking about your own lifestyle during your golden years.
Best bet: Discuss these and similar concerns with the key trusted professionals in your life—who may include physicians, wealth managers, elder care attorneys and others who can partner with you to help you set the stage for a more secure and full life.
1. Joanne Binette and Kerri Vasold, 2018 Home and Community Preferences: A National Survey of Adults Age 18-Plus, AARP Research, August 2018
2. World Health Organization, 10 Facts on Dementia, September 2019.
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ACKNOWLEDGMENT: This article was published by the VFO Inner Circle, a global financial concierge group working with affluent individuals and families and is distributed with its permission. Copyright 2020 by AES Nation, LLC.
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