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Wealth & Well-Being

A Guide to Elder Planning for Aging Parents

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Watching your parents get older is difficult, especially if their health or cognitive abilities start to decline. If you haven’t started planning for your parents’ future care and financial needs, it’s important to do so sooner rather than later. Here are a few areas of considerations we recommend you start discussing with your parents and a trusted financial professional.


If you have siblings or aunts and uncles, make sure to include them in the conversations regarding your parents’ elder planning. Just like you, they want to know that their loved ones are going to be cared for as they age.

Of course, it’s not going to be easy to discuss. You’ll need to address touchy subjects like:

  • Who will be the primary caregiver - a family member or outside hire?
  • Where will they live?
  • How much is each sibling expected to chip in financially?
  • Who should have power of attorney?

Be patient, communicate your expectations, and prepare to have some hard discussions. These talks can be difficult, but addressing things now will help make sure your parents are well cared for as they age.


Are your parents planning on aging in place, or will you need to consider other options? If they’re still living in the same house you grew up in, it’s possible the property may become too cumbersome or unsafe for your parents to continue living in as they get older.

Here are a few alternatives to consider:


Downsizing to a smaller home requires less upkeep and can help stretch their retirement savings farther. If your parents aren’t using all the rooms in their house, why continue to pay for taxes, electricity, and maintenance on unused space? For this new stage in life, it can make a lot of sense to find a smaller, more suitable home.

Renovating Their Current House

If your parents are set on staying in their current home, there are modifications and renovations that can be done to convert it into a suitable retirement home. Depending on the state of the house, the cost will vary significantly. Renovations could include wheelchair ramps, adding a bedroom to the first floor, installing chair lifts, etc.

Assisted Living

Independent and assisted living communities offer seniors a number of benefits including in-house staff to help with daily living activities, meals, social events, opportunities to learn new skills, day trips, and more. Prices do vary, but expect a monthly cost of $1,500 to $4,000 for independent housing or $3,500 to $10,500 for assisted living.1

Moving in With a Family Member

Many adult children are more comfortable keeping their parents close by then having them continue to live on their own. Selling their home and moving them in with a family member offers a significant cost savings, but it should be considered carefully. If your parents physical health or cognitive function starts to decline, do you or the family member their living with have the capabilities to care for them? Is the home well-suited for aging loved ones, or do renovations need to be made?


Around 70% of seniors will need some form of long-term care in their lifetime.2 That makes preparing to cover the costs of long-term care a crucial component of elder planning. The more time you and your parents have to prepare, the less financially devastating the need for long-term care becomes.

Long-Term Care Insurance

As with other types of insurance, the premiums for long-term care insurance will vary depending on your parents age and health. The earlier a policy is purchased, typically the less expensive the premiums will be. If your family has a long history of health problems later in life, adding long-term care insurance to your parent’s financial plan might make sense.

Medicare & Medicaid

Most long-term care costs are not covered by Medicare. However, depending your parents income, they may be eligible to use Medicaid to cover their nursing home costs. The income limit will vary by state, but they’re usually higher for nursing home residents.

Look into Medigap and Medicare Advantage plans, as these may offer additional coverage for long-term care costs not provided through Medicare Part A or B.

Health Savings Account (HSA)

If your parents have an HSA, they can use tax-free withdrawals to pay for long-term care insurance premiums. However, there is an annual limit on how much they can use from their HSA for these premiums.

If the long-term care insurance policy qualifies, the 2022 limits are:3

  • $450 for individuals under 40
  • $850 for individuals between 40 and 50
  • $1,690 for individuals between 50 and 60
  • $4,510 for individuals between 60 and 70
  • $5,640 for individuals over 70

In addition, many costs associated with long-term care qualify as eligible expenses for HSAs, according to the IRS. It’s wise to check the list of qualified healthcare costs each year, as more things may be added.


Elder planning is complex and multifaceted. With so many moving pieces, it’s important to work with a financial professional who can help develop and facilitate a comprehensive plan.

An Elder Planning Specialist (EPS) has the training and tools needed to manage the unique concerns of agent clients. The EPS designation is rather unique, with only a handful of CERTIFIED FINANCIAL PLANNER™ professionals carrying this distinction.

An EPS addresses the needs of your aging parents by:

  • Creating a comprehensive aging plan
  • Understanding the hidden costs of caregiving
  • Building better channels of communication amongst family members
  • Addressing long-term care and healthcare concerns
  • Establishing a network of trusted professionals

If you’re concerned about the future of your aging loved ones, it’s beneficial to act sooner rather than later. Make a plan while your parents are still in good physical and mental health, and it will make life much easier later down the road. Our team includes an EPS who can help you begin to address the different areas of concern and create an elder plan that works for you, your parents, and your family. Don’t hesitate to reach out and start a conversation today.

Written by Kristina George in collaboration with Lexicon Content Development


1. The Average Cost of Senior Living: Can You Afford It?

2. Long-term care statistics 2022

3. 2022 Tax Deductible Limits News

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