UPDATED September 21, 2019
Clark Howard is a well-known radio host and consumer expert. His nationally syndicated Clark Howard Show is heard by millions across the country. An article on his website discusses the need to plan for the impact long-term care can have on a family especially when you are in the situation of having to take care of multiple generations – otherwise known as the sandwich generation. This is when you must take care of your parents and your children. This leads to major life changes for young families. Clark says if you're part of the "sandwich generation" caught between these obligations, he offers some important advice.
1. Consider an Affordable Long-Term Care policy
If you are 50 or 60, you're in the prime age to buy long-term care (LTC) insurance, a kind of policy that pays for care in a nursing home, assisted living facility, or your own home as you age.
Shopping for LTC insurance can be simplified by contacting an independent agent who can shop quotes from a variety of companies for you. The website of the American Association for Long-Term Care Insurance is a good starting point.
When shopping for LTC insurance, look for a lifetime benefit--or at least five years' coverage if that's too costly. Also, be sure the policy adjusts for inflation so the benefit is not subpar when you need it.
Finally, you only want to consider companies that have been rated "A++" (by A.M. Best), which means they are of the highest financial strength. Visit AMBest.com to search ratings. Free registration is required.
2. Get a will in place
If you have kids, you need a will for the simple fact that if you don't have one, the state will decide who raises your kids. That's the reality in the absence of any written direction from you.
Some people use the excuse that doing a will is too complicated and too expensive for them to undertake. I don't buy that. It's true that if you have a complicated life--maybe you own your own business or have a blended family -- you do need to go see a lawyer who specializes in wills, estates, and trusts.
However, if you have a relatively simple situation, I like the WillMaker software that you can pay to use through Nolo.com. They do a great job of asking interactive questions to guide you through the will completion process.
If you get confused along the way, stop and see a lawyer. Or push through and know that it is much cheaper to have a lawyer review the will you've self-prepared than to actually prepare one for you from scratch.
3. Get a durable power of attorney in place
A durable power of attorney (DPA) is a document which allows your parents (the principal) to authorize you (the "attorney-in-fact") to make financial/legal decisions and to make financial transactions on their behalf.
There are advantages to having a lawyer draft a DPA. First, an attorney-drafted DPA can be drafted to meet your individual needs. Although there are pre-printed forms available, they are worded broadly and do not give you as much flexibility. Second, since DPAs are subject to abuse, it is a good idea to meet with an attorney to make sure both the principal and attorney-in-fact understand the document and the attorney is assured of the principal's competency.
4. Protect your children's identities
It's an unfortunate fact that kids are targets for identity thieves. According to the 2012 Child Identity Theft Report, children are 35 times more likely to be subject to identity theft than an adult.
Thankfully, AllClearID.com is now offering a new free service called ChildScan. The service combs through credit records, employment records, criminal records, and medical accounts to find out if a crook has been using your kid's Social Security number. Visit AllClearID.com/Child for more details.
Crooks target kids because they're ideal candidates for identity theft--no credit history, but a clean Social Security number. As a parent, you want to make sure nobody messes with your children. And the sooner you find out the better because if it goes on for a decade or more, it can take years to clean up.
For more tips to save money on family living, see the life family and lifestyle section of www.ClarkHoward.com.
As Clark Howard says, affordable Long-Term Care Insurance will allow you to enjoy your choice of quality care without placing the burden of caregiving on your children. Your kids will get older and they will have their own careers, families, and responsibilities. Don’t place this responsibility on them.
Affordable Long-Term Care Insurance provides you with the tax-free resources to pay for quality care without draining savings and adversely impacting your income and lifestyle. However, long-term care is all about family. It allows your family the time to be family as you get older and not having the deal with the role of caregiver.
The best time to start planning is before your retirement, ideally in your 40s or 50s when you can enjoy low premiums and the most options.
Start your research by going to the LTC NEWS cost of care calculator. Find your state and see the current and future cost of long-term health care. Plus, you will see additional information including state-specific tax incentives and more. Click here to find your state.
You should seek help from a qualified and experienced Long-Term Care Insurance specialist. They should represent multiple insurance companies, understand how the Long-Term Care Partnership Program works, and have extensive claims experience. A qualified specialist will know how to design a very affordable plan which matches your age, health, finances, and goals. Find a qualified specialist by clicking here.
Enjoy peace-of-mind for multiple generations to come by adding an affordable LTC policy to your plan. Start your research now.