What to do when finances are running low

When families contact me for help and planning, one of the concerns expressed is the rapid depletion of funds while paying for care.  It is a complex problem to solve.

The reasons for this challenging situation vary from a lack of adequate retirement savings, low income, or unfortunate decisions about investments and real estate purchases, or inability to live within a realistic budget. There also could have been too many gifts or transfers of assets, or financial exploitation.

Sometimes adult children are paying for care or supplementing an elder’s monthly expenses. There could also be a large debt accruing due to a gap in adequate personal funding. One recent client owed the town close to $500,000 in deferred taxes. Another owed an assisted living facility $100,000 due to a conflict in the family over selling the parents’ home which they were no longer residing in. A daughter of another client was not able to save for college or her own retirement due to paying over $5000 per month for her parents’ care in an assisted living community. At some point, those facing these types of challenges realize it is unsustainable.

There are a few ways to help fund care and try to solve this kind of crisis. One is to explore eligibility for state funded homecare through Medicaid. Also, determine if the elder could be eligible for the VA Aid and Attendance program for Veterans who served during a wartime period, or their surviving spouse. The application process can be a bit overwhelming, but the benefit is worth the effort. There are paid consultants who can help navigate the system and streamline the process. There is also a Reverse Mortgage option if the elder lives in the home and there is adequate equity available.  These programs can help fund part-time care in the home, but would not usually be enough to fully fund assisted living costs.

As a last resort some individuals who cannot afford their care must consider a skilled nursing home and apply for Medicaid for funding. In this situation I recommend working with an elder law attorney who can advise about preparation and planning for this application.

If your elders are not yet in need of care, now is the time to start planning to ease the headaches down the road.


by Joan Garbow, MSW, LCSW, CCM
Advanced Member of The Aging Life Care Association