The Sandwich Generation . . . Helping Your Aging Parents
by Carol Abaya, M.A.
for release September 1, 2000
Are you juggling doing errands for your aging parents, your children, yourself and working at the same time? Are you tired, stressed out and upset that your once vibrant parent is now frail and needy?
Do you feel alone? Rest assured you are not alone! The Sandwich Generation is dedicated to the 50 million Americans who may have elder/parent care concerns and/or responsibilities.
Establish Goals When Handling Parents’ Finances
Question My father, 72, had a bad heart attack, and I’ve had to take over handling their finances. He always refused to talk about money. So I don’t know where to start.
Answer I faced the same situation with my mother. One day, my mother was running her real estate business and the house and the next day she was in the hospital very ill. We had no idea what my mother had or what their total income was. My mother (still working at 85) took care of the IRS. My father (then 90) knew what his income was, but not my mother’s. So the following is what I did.
First, you need to have Durable Power of Attorney. If your father is too sick at this time to understand all the elements, at least identify all his bank accounts and get POA cards from them. I had to have a notary at the hospital witness my mother signing the bank cards. Two months later, when she was out of the hospital, her lawyer drew up durable POA documents for both of my parents.
Next, you need to make an inventory of all their assets and how they are owned - jointly or separately. Then determine their income. A good starting point is their last year’s income tax and documents in a bank vault.
Once you have all this, establish financial and care goals. My parents wanted to stay in their own home. So I worked around this as far as care went. They had live-in help for 6 years.
On the financial side, I had 3 goals maximize income; minimize taxes,
both current and estate; and preserve principal. How much you can do depends
on assets and income. Some TIPS:
• if income is high, look into tax-free investments to lower
current taxes. This will help maximize income as well as reduce taxes.
• If assets are over $700,000, some estate planning and gifting
are warranted. Gift appropriately as long as income covers their daily
living needs.
• Simple estate planning can be done by having some assets held
in only your father’s name and others only in your mother’s name. Wills
should then set up marital trusts so the survivor has income from the assets.
Then when the second parent dies, the assets will go to the beneficiaries.
If assets are considerable, a certified elder law attorney (e.g. member of the National Academy of Elder Law Attorneys) and estate tax accountant should be consulted.
Organized record keeping is a MUST. I set up separate file folders and kept every piece of paper. You never know when a relative or IRS will question what you did. The various folders bills to be paid; bills paid; checking account; savings account; dividends; real estate taxes. And whatever other key areas there are. I also started tracking dividends and other income in a 12-column letter book. It’s the easiest way to see cash flow and know if all income has been received.
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Do you have a question? Send it in. Although letters cannot be answered individually, appropriate letters will be answered in this column whenever possible. Letters may be edited. Send letters to Ms. Carol Abaya, c/o Name\Address of YOUR newspaper (or mail direct to her at PO Box 132,Wickatunk, NJ 07765-0132) or e-mail her at SandwchGen@aol.com.
Carol Abaya is an international-award-winning journalist and creator of the unique magazine The Sandwich Generation: You & Your Aging Parents.
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