Advertisement 1

Stop putting it off — Adult children need to have that difficult talk about aging with their parents now

No one wants to plan for their parents being incapacitated, but it’s important to do so before you are forced into making quick decisions

Article content

Close to one in four Canadians will be seniors by the end of the decade, according to the federal government. In addition to a rapidly aging demographic, sadly, the prevalence of dementia syndromes is also increasing, with the number of people living with Alzheimer’s disease doubling every five years, according to the Centers for Disease Control and Prevention.

Advertisement 2
Story continues below
Article content

These factors, coupled with the COVID-19 pandemic and the associated focus on long-term care, have highlighted the need for families to consider how their loved ones will be properly cared for as they age and are potentially no longer able to make decisions about their health and financial wellbeing.

For families, this extra level of financial planning adds a layer of pressure to an already stressful time. Incapacity has a significant impact on the daily lives of both the individual experiencing it and their loved ones, causing significant stress, anxiety and feelings of helplessness. Effective incapacity planning can significantly diminish these feelings of stress, but it is vital to have open and honest conversations among family members, and to consider the measures and steps that need to be taken well in advance.

Article content

Most of us find it difficult to contemplate our parents being unable to care for themselves, but, unfortunately, most people do not consider how to address incapacity until they are dealing with an immediate situation, such as a family member facing a long-term illness or going through a significant life event like a divorce. Without an established mandate or medical directives, spouses or relatives may need to make a host of decisions to ensure their loved ones’ interests are properly protected in the heat of the moment. This can lead to conflict between family members who have competing views on how an incapacitated family member’s affairs and finances should be managed.

Article content
Advertisement 3
Story continues below
Article content

To limit these issues, it’s important to have these conversations beforehand, ensuring all appropriate parties are involved, and put in place practical financial and legal arrangements while you and your parent (or parents) are in the best position to make these decisions. In addition, finding financial and legal advisers you trust and who are focused on helping you and your family manage your finances during a host of scenarios, including in the event of incapacity, is an important step in navigating this process.

Some of the most important initial steps include making advance planning measures to outline the key decisions that need to be made ahead of time, and to ensure this is documented and communicated with both family members and advisers. In addition to a living will, there are two key documents: a power of attorney (or mandate for incapacity or protective mandate, in Quebec) for managing property, which allows your attorney to conduct financial transactions on your parents’ behalf, and one for personal care that allows your attorney to make decisions for your parents’ health care in the event of incapacity.

Advertisement 4
Story continues below
Article content

There is no single ideal arrangement for aging Canadians and their families, since every situation is different and the level of autonomy an individual has significantly varies depending on a host of factors, including age, health and financial wellbeing. An incapacity plan’s arrangements should be tailored to the particular individual and circumstance and should continue to evolve as health and wellbeing needs change. This may mean considering that additional help will most likely be needed as your parents’ aging advances. It is important to consider and plan for the various degrees of help that parents or family members may require at different phases and to determine the most suitable accommodation for these circumstances.

Recommended from Editorial
  1. None
    How to figure out the best place to live during the last 15 years of your life
  2. If you die without formally indicating your wishes, you die “intestate,” meaning provincial law determines how your assets will be distributed.
    Protect your legacy, protect your family — It’s never too early to start estate planning
  3. Advisers and people with aging family members should be asking seniors about DIY investment accounts.
    New rules boost financial protection for seniors, but getting them to opt in can be a delicate process
  4. We are entering an age of unprecedented wealth transfer for parents and children, and there are complexities for those both leaving and receiving inheritances.
    Canadian inheritances could hit $1 trillion over the next decade and both bequeathers and beneficiaries need to be ready
Advertisement 5
Story continues below
Article content

One approach is to think of the three stages that you might encounter: the first stage is when you should be completing your planning, when your parents are still active, healthy and enjoying retirement or semi-retirement; the second phase is if you notice your parents are slowing down and experiencing declining health; and the final phase is when your parents may require additional support, such as nursing or care provided through a long-term care facility.

Each family has its own goals and challenges, but a common thread is that incapacity planning in advance can best prevent heartache and stress down the line. By planning early, taking into consideration the various factors and phases you may encounter, and ensuring you bring in the right advisers to assist with the process, you will be able to reduce the stress and anxiety for all involved.

Sarah Widmeyer is senior vice-president, Wealth Strategies, at Richardson Wealth, and serves on the board of directors of the Women’s Brain Health Initiative.

_____________________________________________________________

 Get more stories like this in the FP Investor newsletter.

______________________________________________________________

Article content
Comments
You must be logged in to join the discussion or read more comments.
Join the Conversation

Postmedia is committed to maintaining a lively but civil forum for discussion. Please keep comments relevant and respectful. Comments may take up to an hour to appear on the site. You will receive an email if there is a reply to your comment, an update to a thread you follow or if a user you follow comments. Visit our Community Guidelines for more information.

This Week in Flyers