Taking care of a family member who is aging is a reality that many will face, and they often face it unexpectedly, with little help. This can be a stressful situation — both emotionally and financially.
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If you’re the adult child of an aging parent, you may be wondering how you can possibly hope to save and plan for the future while caring for mom or dad. Shaun Bettman, a former financial advisor and chief mortgage broker at Eden Emerald Mortgages, provided some insight into the conundrum.
“It’s rarely a planned thing. One medical bill turns into a recurring cost. Then you’re covering groceries, fuel, maybe helping out with rent or aged care. Before long, your budget starts to feel like it’s leaking from all sides,” he said. “I’ve seen it happen to people with good jobs and strong savings, and still, they end up stressed and stretched thin.”
So, what can you do to avoid getting stretched so thin that you snap?
First and foremost, look at your own spending habits. If you don’t have a strong, structured, smart budget in place already, now is the time to adopt one.
Bettman recommended you sit down and write out all your fixed expenses, like:
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Mortgage or rent
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Utilities
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Car payments
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Insurance payments.
Then, write down all forms of regular income you get.
Finally, sit with what’s left over and figure out how much you can afford to spend on other areas of your life, like gas, food and entertainment. Those areas tend to be more flexible, so they’re places where you can identify opportunities for savings.
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Now that you’ve sat down with your own budget, it’s time to look at what your parents are spending.
Bettman said, “Most people only think about the big stuff, like medications or a hospital bill, but the smaller things hit harder over time. Gas to and from appointments, supermarket extras, picking up their bills without tracking them. I’ve seen people spending over a thousand dollars a month and not even realize it until we laid it out. Once they saw the full picture, we were able to restructure their mortgage to bring down monthly costs and create some breathing room.”
Also factor in your parents’ income from retirement funds or Social Security, and their spending on regular expenses — how much more money will you spend on their medication, on gas for their appointments and on their food? Add these items to your expense column, and add their income to yours. Now, you can create a budget that makes sense for your household for as long as you’re in the caregiver position.
Knowing exactly how much money is coming in and going out will show you what’s left for savings — and identify potential costs you can cut back to save a little more.
One of the greatest areas of support can be family — that’s why you’re here, looking for ways to save as a caregiver to an aging parent. You’re the family. But don’t forget the rest of your family, if you have them.
If you’re not an only child, have open conversations with your siblings to help your parents, even if you’re the primary caregiver.
Bettman advised closely tracking everything. “I’ve worked with clients who built a simple shared account. Each sibling dropped in a fixed amount every month. Everything went through that account — nothing fancy, just clear. They tracked it in a spreadsheet and avoided the usual, ‘I paid last time, it’s your turn’ arguments. When there’s structure, it feels fairer and a lot less personal.”
Even if you don’t have siblings, reach out to aunts and uncles, grandparents and anyone else who might be in a position to help. Now is not the time to be prideful. Rather, it’s an all-hands-on-deck situation. You can ask for monthly contributions or even just coverage for a single bill every month.
Every little bit of help you can get from a family member gives you a bit more room to breathe and save some money.
Speaking of support: You don’t just have your family to rely on. There are plenty of programs you can turn to for help, as well.
Bettman noted the long list of services you can tap into: “There’s more out there than people think. I’ve helped clients apply for aged care packages, energy rebates and transport vouchers. It’s not fun paperwork, but once it’s sorted, the savings add up. Even if it only covers a few hundred dollars a month, that’s money that no longer needs to come out of your pocket.”
Yes, it will take time and digging. It will likely take phone calls and paperwork. Consider a new cell phone plan, getting discounts for your power bill and even food assistance.
But it’s worth it if it means you can save a little extra money at the end of every month. You’re already charged with the physical and emotional strain of caring for an elderly parent. You don’t have to just accept that it will also be a financial strain.
It’s time to get creative and constructive and save wherever you can.
Finally, if and when you come to the realization that this caregiving situation is going to be long-term, treat it like a long-term financial phase. Whether you’re caring for your parent for the rest of their lives or for a few years, until they’re on their own again or in a nursing home, think about how to restructure your finances to accommodate this care.
Bettman said, “I’ve worked with people who paused investment plans or adjusted loan repayments so they had more cash flow without dipping into debt. One client used his offset account to build a buffer just for his dad’s care. That kept the money close, lowered his interest and gave him peace of mind, knowing he could access it without reshuffling everything.”
Again, you can get creative with your spending, your savings and your investing. It’s a simple matter of thinking outside the box and listening to the experts.
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This article originally appeared on GOBankingRates.com: I’m a Financial Expert: 5 Practical Tips for Saving While Supporting Aging Parents
