The Many Expenses of Long-Term Care

Long-term care is expensive. And sometimes it costs a lot of money too.

There may not be a great deal of cash changing hands as a result of someone’s gradually increasing need for long-term care, but that doesn’t mean a steep price is not paid. 

And often, that price is paid by the healthy spouse. 

This is not a financial price. It’s a physical, psychological and emotional price. 

The healthy spouse may not even begrudge the caregiver role – many wouldn’t dream of allowing anyone else to take the role of primary caregiver to their lifetime partner. 

Back in the day, when they said “for better or for worse” and “till death do us part,” they meant it.

But if you know and love a caregiving spouse, watch her carefully (the majority of caregivers are women). She may literally work herself to death caring for her husband, and that wouldn’t be good for him, much less for her. 

In addition to the physical, emotional and psychological costs associated with long-term care giving, there are financial costs. But it often comes as a surprise how these various costs compare to one another. 

Often the first step is hiring someone to help your Mom while she helps Dad. Great idea. If Mom just needs some extra help around the house for a few hours a day, you might get away with paying someone $15 an hour for 20 hours per week. Let’s call that $1200 a month. Not chump change, but if it gives Mom a break it can be worth every dime. 

I hate to say this, but these situations rarely stand still – they move in one direction or the other. To be blunt, the likelihood is that an older person needing a little help will either die or continue declining. He is unlikely to simply remain at his present level of health for an extended period.

So, fast forward a year or two. Imagine that you don’t need caregivers for four hours a day, but 24-hours a day. Assuming the same hourly pay rate, that comes to $130,000 per year. And my experience is that once you get to that level, $15 won’t cut it. You’re probably looking at $25 an hour, or about $220,000 per year.

I spoke to someone this week who told me caregiver rates in Dallas were up to $45 per hour.

Many are surprised to learn that a nursing home is not the most expensive option, but often the least expensive option for someone needing full-time, round-the-clock care. 

In the abstract, before they experience a day, week, or month of round-the-clock care giving, I’ve heard well-meaning adult children say, “I’m never going to let Momma go into a nursing home.” 

I understand the emotion behind that statement, but it is a foolish promise to make. You just do not know what the future will bring.

So, what can be done at an early stage, when caregiving first begins?

Honest conversations. If you are an adult child of aging parents, you need to have a very honest conversation with them about where they are now and what their wishes are. Be frank with one another about the state of their financial, physical and emotional resources. It’s their money and their lives, so you’re in no position to dictate anything. But most parents have a strong urge to “not be a burden” to their children, and are interested not only in their own well-being, but also that of their offspring. 

Holistic planning. Work with an elder-care attorney to explore any options for financial assistance available to you. Very few people have a grasp of what resources are available and when one might qualify for those benefits. An experienced elder-care attorney can be very helpful in educating you about your options. The services of a financial advisor may also be helpful, not as a replacement for, but a supplement to the primary work of an elder-care attorney.

A word of caution: as people age, often their capacity to make difficult decisions declines as well. The default mode of “do nothing and hope for the best” can kick in. 

So, the most helpful thing an adult child may be able to do for aging parents is to prod them into action. Initiate that honest conversation. Set up a meeting with an elder-care attorney.

Those would be meaningful first steps in the long journey of giving care to those you love. 

Argent Advisors, Inc. is an SEC-registered investment adviser. A copy of our current written disclosure statement discussing our advisory services and fees is available upon request. Please See Important Disclosure Information here.

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