Second Marriages, Blended Families, and the Elderly

Maybe the second marriage occurred when your parent was younger, maybe as a result of a divorce, and you and your step-brothers/sisters have grown up together. Maybe the second marriage occurred later in life when your mother or father was widowed and you and your step-brothers/sisters have gotten to know each other as adults.

It's wonderful when the various parts of blended families get along and enjoy each other, regardless of what stage of life the blending occurred. Every family works out the relationships based on their individual circumstances.

When an elderly parent begins to need more assistance, these 'step' relationships and responsibilities can become difficult. The difficulties become compounded when there are financial issues and the different parts of the family have different financial situations.

Some simple different scenarios:

Henry and Pam were both widows with grown children when they met in their 60's. After dating for a few years, they were married. Their children lived in various parts of the country and only saw each other on occasion. Now well into their 80's, they were experiencing enough health issues that some decisions needed to be made. Their own children had Powers of Attorney and Healthcare Powers of Attorney meaning decisions were being made separately. These adult children really didn't know each other and didn't want to make joint decisions. Adding to the difficulty was the fact that there was a considerable difference in finances between both Henry and Pam as well as their various children.

It was also a second marriage for Irving and Lois. Irving's son never liked Lois. As Irving's health began to deteriorate, the son wanted to make sure that Lois didn't use up too much of Irving's money. The son was able to move money from Irving's personal investment account into his own account. Irving and Lois had always pooled their income to live on. The reduction in income resulting from the son shifting capital was causing Lois to not be able to afford to hire aides to help care for Irving.

The above two examples illustrate a couple of potential types of problems. Even with the best of blended family relationships, there will be issues. If you want to move your aging parent to be geographically closer to you, are you going to separate them or move them together? If there is a significant difference in financial abilities, are you willing to help pay for the step-parent's care?

Good planning and communication before a crisis arises is the key. Not every possible scenario can be planned for but while everyone's physical and cognitive health is good, the conversations must be had.

Budgeting-- Even More Important for the Elderly

Budgeting. Ugh, not a process that anyone enjoys but everyone know that should be done. It doesn't matter if your income is $1000/month or $100,000/month, it's still important to plan spending levels. Many people assume that once they retire or reach a certain age that they no longer need to think about budgeting. The reality is just the opposite, budgeting is even more important for the elderly.

The biggest fear that most elderly people have is outliving their money. But, a big mistake that the aging make is to not pay attention to where they're spending their money. I think the assumption is that their expenses at this stage of life are beyond their control. This is far from true.

Here are some examples of places to look to save.

Drug costs. Most seniors today have Medicare Part D prescription drug coverage. But, this doesn't mean that there aren't ways to save. Pay attention to what is prescribed. Some drugs may not be covered in your plan but a good substitute may be. Look into different stores or mail order options to see if the prices vary. Pay a lot of attention to over-the-counter products. There are huge price differences from one retail chain to another. Convenience becomes a factor in these decisions, especially if driving is a problem.

Car-related issues. Cars are expensive to drive, maintain, and insure. Many elderly couples keep two cars. As they age, there may be less of a need for both cars--maybe they always go out together, maybe one really should no longer be driving, maybe they live in a community that provides some transportation services.

Lifestyle. Ah, this is a tough one. Most people, the elderly included, want to continue the same lifestyle that they are used to. Again, it doesn't matter what income bracket. An elderly person's income may not be able to continue to support belonging to multiple country clubs, a lot of restaurant dining, or buying generous gifts for family members. It also doesn't mean going to the other extreme and living like a hermit. But, as hard as it may be to change, staying the course when it comes to day-to-day lifestyle issues may not be realistic.

The key to budgeting is to realistically examine where money is being spent and make conscious decisions about spending instead of blindly going forward month-in and month-out. This is true at any age but especially true for the elderly. There aren't too many options for generating additional income to cover the spending.

Misleading Medical Information and the Dangers to the Elderly

An earlier post was about phishing emails and how hard it was to realize when it wasn't a legitimate email. Today's subject is similar but related to medical and pharmaceutical information. It could go in a number of different directions, but because Kitchen Table Finance is aimed toward baby boomers and their elderly parents, this will focus on information found in mainstream newspapers.

I was sitting at the kitchen table in one of my client's homes, working on their bills. Annie and Bill were a well educated, sophisticated couple. Bill was well into his eighties and suffering from serious vision problems. As he could no longer read the paper, Annie was reading it out loud to him. I couldn't help but hear the information as she was reading. It was about a product containing calcium, vitamin k, and other miscellaneous vitamins. To listen to what the article was saying, you'd think that they had just discovered something as game-changing as Penicillin. They both decided to call the phone number given in the article to order the product. I try to keep up with the news and I was surprised that I hadn't heard about this particular combination and protocol and all the medical problems that it was solving. When I was done, I asked Annie if I could look at the article and copy down some of the information. When I saw what she had been reading I realized that it was an ad set up to look like an article.

The elderly are very vulnerable to getting sucked into buying something that promises to solve all their health issues. Hopefully the product at least does no harm. Beware of 'miracle' cures for anything. Encourage your parents to ask their doctor or pharmacist. At the very least, you can do some research on some of the reliable medical websites. Most elderly people don't have money to waste on useless products and certainly can't risk taking something that could have adverse effects.

Phishing Emails, Online Scams, Etc.

It's almost impossible today to not have some of your personal and financial affairs on the computer. No matter how savvy we think we are, the 'bad guys' are one step ahead. I thought I knew the red flags. I read the articles telling you what to watch out for. And guess what? I fell for one the the Bank of America phishing emails.

I got an email from Bank of America telling me I had a 'member alert'. The email had the Bank of America logo, Bank of America copyright information, and a Bank of America email address. I've since gone back to that phishing email to verify that it was a Bank of America extension on the email address and it was. They gave me a link to go retrieve my alert. Now, in hindsight, I should have not used their link, I should have gone directly to the Bank of America site. In my defense, Bank of America has installed some new security software and at times the login is a bit different. Once I was on the site that I had linked to, I was asked some security information to validate who I was--which I stupidly filled in. I was to then receive a validation code which would let me proceed to my account. Surprise, surprise, that validation code never came. At this point, I had already realized my mistake and was on the phone to the fraud department at Bank of America.

I'm openly admitting my stupid blind trust of a real looking email. I'm somewhat horrified at how easy it was to do. If I fell for it, lots of other people fall for it too.

So, here's some of the lessons I learned:

1. Never use a link given in an email. If the email tells you that you need to do something, go to the company's website directly.

2. Never give a social security number, account number, password, debit card number or any other critical piece of information.

3. Stop and think before you act. Use your smarts (I apparently lost mine yesterday).

4. Take into account the type of firm you (supposedly) got the email from. Would a bank really ask you for certain pieces of information? As another example, there's an email that had been circulating from Apple that lead you to think you had a virus on your computer and wanted you to buy a defender piece of software. As you were going through the process of ordering this software and doing a virus scan, these loud beeps went off every time it supposedly found a virus. Thinking logically, Apple would never have this jarring, awful noise go off--that was when I realized it was a scam.

Hopefully for me, I caught my mistake in time. I had to close my Bank of America account and put an alert on our information with the Credit Reporting agencies. I hope that by telling you what happened to me, it'll save it from happening to you.

Keyless Ignition and Keeping Your Aging Parents Safe

Many of the new cars today have a keyless system--you keep your key in your pocket or purse and just push the button to turn on/off your car. This seems like a wonderful convenience (especially when you've just gotten a manicure). But, like all conveniences, there are some things to be aware of. If your elderly mom or dad has one of these systems in their car, make sure they understand how to use it.

It used to be, when you turned your car off, you took your key out of the ignition. You didn't have to worry about whether you actually turned the car off. With the keyless type, if you get distracted or forget, it is easy to leave the car running and go in the house. The cars have a warning system--some type of beeps--to let you know your car is still on. But, many of your aging parents have hearing issues and may not be able to hear the beeps. The first thing to do is make sure you read the owner's manual to know how their particular car's warning system works. The second thing to do is to establish some sort of back-up warning such as a note on the dashboard, on the entry door into the house, or wherever makes sense. If a car is left running in the garage, there is a potential carbon monoxide situation which can be deadly.

The next issue is what happens when the battery in the key dies. My elderly client had this happen and she got stuck in a parking lot unable to get into her car. Fortunately for her, she had roadside assistance and they were able to put a new battery into the key. Again, the important first thing to do is to read the owner's manual to the car and find out what the back-up system is, what they tell you to do. Establish a plan beforehand.

The final situation I've experienced with my clients was with a husband and wife. They went out to do some errands together and then he was dropping her off at a friend's while he continued on with the errands. Sounded so simple.....What happened was that the key was in her pocketbook. After he dropped her off he went to Home Depot. When he came out, guess what? He didn't have the key to start the car. Luckily for cell phones, he was able to call her and her friend drove her to give her husband the key. I'm not sure what is the answer to preventing this from happening other than plan ahead.

Getting inconvenienced by not having the key is annoying, leaving a car running in the garage is dangerous. Make sure that you and your parents have read the owner's manual to the car, are aware of the potential problems, and have a back-up plan in place.

KISS - Keep It Simple, Seniors

Keep it simple is the goal, start to simply early on. I see my elderly clients with multiple checking accounts, CD's at various banks, a number of small life insurance policies and annuities with different companies. What happens is a lot of confusion, a lot of paper, and a huge administrative issue. What seemed like good financial sense at the time ends up being overwhelming.

Does this scenario sound at all familiar?

It seemed like a good idea to go to another bank in town to buy a CD as their rates were slightly higher than their primary bank. It seemed like a good strategy to take advantage of an annuity that their bridge partner's son was selling. After all, it was nice to help a friend's son out when he was just beginning. Back in the day when Money Markets were paying a decent amount of interest, it made sense to open up another checking account. But, that account couldn't be used as the main account as only a certain number of transactions were allowed per month. Some of these financial investments were titled individually, some jointly, some in a trust account.

The examples could go on and on. The repercussions range from the mundane daily overload of statements to the legal implications upon the death of one of the account holders. Maybe one of your parents enjoyed spending time taking care of their finances, researching opportunities, and investing/purchasing different investment vehicles. That may have worked when they were younger and could keep on top of everything. But, that may no longer be the case.

Listen when one of your parents starts to make little comments about being overwhelmed trying to keep track of their finances. They may be embarrassed to admit that they need help. When you visit with them, notice if there are piles of papers accumulating. That's a sure sign that no one is looking at them.

The first thing to do is to start to make a list of all their accounts, where they are held, how they are titled, how much they are worth, and if there is an advisor or sales rep handling the account. This may take some time to accomplish. I've been working on this with one of my elderly clients and thought I had it complete. Totally out-of-the-blue, an IRA statement came in the mail that I hadn't known anything about.

Once you know all the accounts, a plan can be devised to try and simplify things. Ideas can be to merge checking accounts so that there is only one account to use and keep track of. If there is a primary investment accounts, other scattered items can be brought under the envelope of that primary account. For example, the client I mentioned before has some annuities that were separate from her primary brokerage account. They now are being moved under the umbrella of her brokerage account.

Depending on your level of knowledge, advise may need to be obtained from a CPA, attorney, or financial advisor prior to making too many changes. Tax and estate planning implications need to be looked into before making any changes.

Bringing this conversation back to the original idea of KISS -- your elderly mother shouldn't be confused as to which checking account to write a check from, be stressed about all the statements coming in the mail, or worry about who is watching over all her accounts. Simplifying things will help her now, and you and your siblings when the time comes that one of you need to take things over.

VA Benefits - Another Way to Pay for Care

Veterans that are part of the Department of Veteran's Affairs health care program may be eligible for benefits for either home-based or institutional care. It is an often overlooked avenue to help pay for needed care.

It is far beyond the scope of this blog to go into detail as to how to go about applying for benefits. It is the intent of this post to make you aware that this option exists so you can research to determine if it is a viable option. If your aging parent is a Veteran and is part of the VA system some of the benefits may include: geriatric primary care, home based care, skilled home care, adult day care, VA Community Living Centers, and community based nursing homes.

There are stringent qualification requirements that must be met for both the home and institutional care benefits. Each case will be evaluated individually looking into the case from both a medical and financial perspective.

Each family must decide if they are able to handle the eligibility process on their own or if the better way to go is to hire an advocate to handle the process on their behalf. The important thing though is to take advantage of the benefits available and not be intimidated by the process.

A good place to start the research is on the VA website, www.va.gov/geriatrics/

Family Dynamics and the Impact on Aging Parents

One of the common themes running through both my business and this blog is the impact of family dynamics on the life of the aging parent. We all have 'it' somewhere on the spectrum --few of us have The Waltons, few of us have truly dysfunctional situations. Some of the stereotypical profiles that I've encountered are:

Practical Patty. This is the sibling that gets the job done, that finds the help the aging parent needs, and figures out the insurance issues.

Hand-wringing Hannah. This is the sibling that worries what's going to happen, imagines every possible awful scenario, and is usually immobilized.

Peter Pan. This is the one that has never grown up, the one that never plans ahead and whose head is in the clouds - and probably can't be relied upon.

Squirrelly Sam. This sibling usually has a hidden agenda. It might be that they have been planning on an inheritance as their finances aren't in good order and that underlies all their input into the situation.

Marge in Charge. This is the bossy one who tells everyone what to do - whether they want to be told or not.

I'm sure most of you can recognize some of these profiles and have long histories with your siblings. By acknowledging these issues they can be built into planning for the care of your aging parent. This is the reality of the situation, maybe not the ideal.

Some family histories and dynamics are so emotionally charged that the best option is to acknowledge that the siblings can't work together. In my experiences, the aging parent usually knows this in advance and sets up their affairs so that they are independent from their children's involvement. This situation is even more pronounced when there is a daughter or son-in-law involved that the aging parents doesn't like or trust.

The important take-away from this blog topic is for both the adult children as well as the aging parent to recognize the realities of their own family dynamics and plan accordingly. As I said in an earlier post --if you and your siblings can't get along in a non-stressful social type situation, the chances are really high you aren't going to be able to work together at a stressful, emotional point in time.

Twitter and Daily Money Management

I'm off subject again but, hey, why not? I was at a business networking meeting the other night. I began speaking with a young man who told me that his business was social media marketing. This is one of those careers that didn't exist a few years ago. It's a subject that I'm actually quite interested in although a little skeptical as to how it may apply to my type of business.

I started to ask him questions about using Facebook, Twitter, YouTube, and LinkedIn. Of course he was horrified to find out that I only used Facebook to find my old grammar school and summer camp friends, had never sent a tweet, and only looked at cute dog videos on YouTube. He was happy to hear that I had a blog!

So, he told me I should link my blog to my Facebook page so that my friends would comment on my blog and then their friends would see my blog, and so on. In that way I could geometrically increase my blog audience. I think he thought I was some sort of a throwback to some ancient civilization when I told him that I wasn't comfortable using my friends in this way.

Then we moved on to using Twitter. I know what Twitter is although I'm not sure I get why anyone tweets. I know that I have a hard enough time keeping up with the news, the mail, the email, the texts, what to use my laptop for, do I need an iPad. Some days I'm sure that my smartphone is smarter than I am. Why I would want a constant stream of drivel is beyond me. When I'm at the gym, there is a twitter feed on the tv screen with motivational messages from personal trainers. Enlightening things such as 'finish strong' or 'I'm having a healthy egg white omelet for breakfast' or 'push harder'. Hmmmmmm.

I told my social media marketing guru that I didn't think it was wise for me to try to impart financial information in 140 character snippets to anyone. He insisted that keeping in touch in some way was critical so here are my sample tweets about my daily money management business life.

trying to get to client. 12 cars ahead of me at guard gate. will be late

lost in xyz village. every building looks exactly the same.

90 yr old client. 90 degrees in condo. am hot, hot, hot

30 years of financial records stacked on floor. am hyperventilating

What do you think?

Your Not So Elderly Parents Moved to Florida or Arizona or North Carolina or Wherever

But now your very elderly parents live in Florida or Arizona or North Carolina or Wherever.

I was with a client, Anne, that had moved to Florida from New York a number of years ago. She and her husband were 'young' retirees, quickly made new friends and began a new phase of life. Their children stayed in the Northeast and established their own lives and families.

Fast forward 20 years --Anne's lifestyle has dramatically changed. Her husband has Alzheimer's and is now in a nursing home. Anne goes to the nursing home each day, does his laundry, supervises his care, brings him food, and tries to provide him with some socialization. She's taking great care of him. What's going to happen when Anne needs some similar type of care?

There isn't a boilerplate answer to this situation. Every family situation is different and everyone needs to address their own particular set of circumstances. Here are some questions that may help define the issues specific to your family.

• Can you and your siblings work together to come up with a plan?
• Is one of you willing to take the lead, be the point person and be comfortable that they have the support of the other family members?
• Do you know the state of your parent's finances?
• Is there Long Term Care Insurance?
• Can your surviving parent afford to pay out-of-pocket to have help in the house in the event that they can't stay home alone?
• What is your surviving parent's feeling about applying for Medicaid if they don't feel that they can afford nursing home care?
• Is there a significant difference in the finances of you and your siblings? Can one of you help out financially more than the other(s) and how do all of you feel about that?
• Is the surviving parent willing to relocate to where one of the children live?
• Was a goal of your parents to leave a financial legacy to their children? Or, is the surviving parent willing and comfortable using up most or all of their money on their own care during their final years? How do each of the siblings feel about their parent using up all of their money if that situation arises?
• No matter what the quality of home health care or nursing home care, there needs to be someone paying attention, someone to be the elderly person's advocate. If there isn't a family member able to do that due to geography, family relations, or other reason, are there funds to hire someone?

Speaking in generalities, it is typically the woman that is the surviving elderly parent. The woman has been the mom, the caregiver, the nurturer. Now someone has to step up to the plate and make sure she's taken care of.

As a lead in to my planned next post....it's called Family Dynamics - We've all got them. I have a feeling you can predict where this is going!!

Paying for Home Health Care Part One

Or better known as:

MY SISTER-IN-LAW'S CLEANING WOMAN'S DAUGHTER'S BEST FRIEND

As most everyone knows, needing an aide, CNA, or some other type of professional to come to the house to help an aging parent is expensive. It doesn't matter if the need is for someone to cook and drive or someone to provide medical care. Most people don't have insurance coverage for this type of service. So, once they gasp at the amounts quoted by agencies, registries, community organizations, etc., the typical response is to get names from friends and relatives to hire them privately.

There are definitely pros and cons, as well as some legalities and practicalities, to this approach.

The obvious first perceived advantage is cost. An agency will charge an amount per hour or per day. Some of this money is paid to the aide, the rest is retained by the agency for their services. What many people want to do is to hire the aide directly and save the amount that the agency retains for their services. The service that an agency provides is very valuable and the amount saved by hiring someone directly may turn out to be very costly. Not only does the agency screen all employees, make sure they are properly trained and supervised, they also take care of all payroll issues.

Everyone knows that when hiring household help--aides, nannies, cleaning help, etc --that payroll taxes such as Social Security and Unemployment are to be paid. The reality is that most don't do it. The help wants to be paid in cash, the person doing the hiring doesn't want to do the paperwork or incur these extra costs. Even those people trying to do the right thing end up at their wits end actually doing it.

Doreen's husband's medical issues began to get worse. It got to the point that he couldn't be left alone any longer. Doreen got the names of several aides and set-up a schedule to have coverage for 4 hour shifts each day. She called her CPA to find out how to handle paying each of the aides. He explained that she needed to pay Social Security and Unemployment for each of them, file reports on a regular basis, and calculated the amounts for her. Doreen wanted to do this the right way so she followed his instructions. Her husband's condition worsened and she needed progressively more help in the house. The paperwork associated with having multiple aides each week, different pay scales depending on day/night, weekday/weekend became a nightmare. She basically was running her own home health care agency. When just balancing her checkbook became a daunting task because of all these transactions, she threw up her hands and gave up. She had to decide whether to use an agency so they would handle the paperwork, just pay the aides in cash and forget all the paperwork, or hire someone else to do the paperwork for her.

This is the trade-off. Hiring someone directly whose name you get from a friend or relative may be less expensive if you're not paying their Social Security and Unemployment and if you're not paying an agency fee. But, you also aren't getting the screening, training, and supervision that home health care agency provides.

When the Elderly Stop Driving

Today's blog was supposed to be about paying for home health care. I'm going to postpone that topic until tomorrow. The reason? Partially to vent, partially to pass along information that I finally got.

The subject? How to turn in the driver's license of an elderly person that is no longer driving. You see, the insurance company wants proof that the person is no longer driving so you can't just cut up their driver's license.

The frustration? Trying to find out how to do that. Over the past few business days, I have attempted, multiple time, to get someone at the Florida Department of Motor Vehicles on the telephone. I've tried at 7 AM when they say the office opens, I've tried mid-morning, I've tried mid-afternoon. Sometimes the recording comes on and says that due to heavy call volumes you must call back another time. Sometimes I have been able to actually get in the queue but after holding for an indefinite period of time, I've hung up. Soooooooo frustrating.

So today I finally had to go to the driver's license office in person, wait in line, and finally get to a live person. Here's the information so in the event you have to do it, you'll know how.

How to Turn in a Driver's License

If the driver can't come to the driver's license office themselves, as is the case with my client, the spouse can bring the driver's license in. But, the spouse must bring in their marriage license as identification. Otherwise, they will take the license but not be able to give you the proof you need for the insurance company. If there is no spouse, the person with Power of Attorney can bring in the license (with the Power of Attorney paperwork as identification).

Now, wouldn't you think they could put this information on their website!!!

Home Health Care and the Elderly

At some point there may be a need to hire aides whether on a temporary or permanent basis. It can be overwhelming both in terms of costs and finding reliable help. The information offered in this first blog on the subject is meant to be an overview.

Assuming your aging parent has Medicare as well as one of the supplemental medigap insurance policies, some short-term home health assistance may be covered by insurance if the physician deems it necessary following a hospitalization. As a general rule though, neither Medicare or Medigap policies cover longer term home health care. This falls into the realm of Long Term Care Insurance.

It's important to determine the type of help needed. Is the need for someone to drive your aging parent to a doctor's appointment, grocery shop, and make a meal? Or, is there a need for someone more medically qualified to care for health related needs. This is important when deciding where to go to get help.

Once some of the basic needs are defined, finding the right home health person is the next step. Several options are:

Personal referrals from friends and relatives

Local community based organizations such as religious organizations or local councils on aging.

Home Health Care agencies

Home Health Care registries

The difference between an agency and a registry is that the workers for an agency are their employees. A registry lists independent contractors. This can be an important distinction.

Another factor to consider other than cost (which will be the subject of my next blog) is whether anyone is available to supervise the aide. Unfortunately, the elderly are very vulnerable and easily taken advantage of, especially if they aren't feeling well. Hiring someone from an agency, although admittedly more expensive, may be the better way to go if there isn't anyone around to pay attention.

Maybe there was an era when multi-generations of the family all lived close by and there were plenty of people to take care of an aging relative. For many, this just doesn't exist any longer and other options need to be explored when a family member needs assistance.