If you are like many people today who live far from their parents, you can not check in on your parents in person as often as you want to. This is particularly stressful when a parent's health is failing.
Assisted living centers are an excellent option for individuals who need minimal medical attention or help with self-care, but is cost-prohibitive for many people in their retirement years. Depending on their medical needs, having your parents live with you may be a better deal than an assisted living community.
Your Parent's Cost Savings
The Consumer Consortium on Assisted Living reports that assisted living communities charge from $1,500 to over $6,000 per month depending on location, apartment size and the level of services required. The average charge of $3,750 for assisted living amounts to a $45,000 per year expense and the vast majority of residents in assisted living communities pay out-of-pocket.
Your Cost Savings
Pros of Having Parents Move In
- You will know your parents are eating properly and taking medications on schedule.
- Should your parents have a medical emergency overnight, you know someone will be there to call for help.
- Your parents will not have strangers in and around their home for health care and home maintenance when they live with you.
Cons of Having Parents Move In
- You may need to move to a larger home, have handicap aids installed or have an in-laws apartment built on your property. Talk to local authorities about ordinances involving in-law apartments before planning to build.
- There will be an initial period of adjustment for your parents and for your family. This is stressful even if everyone gets along well so plan to put a few obligations on hold for the first few months after your parents move in.
- When discussing the possibility of having your parents move in you need to address potential difficult health issues and end of life planning. Use Planning Your Elder's Care as a reference for this discussion.
Other Financial Considerations
- Get assisted living rates in your parent's area and compare this to the cost of your parents living with you. Be sure to include your travel costs for visits in this equation.
- If a larger home or remodeling your existing home would be needed, decide who will take out a loan to accomplish this, and whether your parents will pay you rent or if you will pay them rent.
- Discuss and work out an agreement regarding how the costs for utilities and groceries will be worked out.
- Let your parents be as independent as possible and discuss how their care will be handled and how they can pitch in around the house by helping with child care, light chores or cooking.
- Check with a financial planner to find out how this living arrangement will effect your parents' estate plan.
- Work with a lawyer and financial planner to ensure that you keep your home should your parents need to eventually go to a nursing home or they die.
- Consult a lawyer to ensure fair distribution of your parent's assets when they die can ease sibling concerns regarding this arrangement.
Case Study: When Your Parents Move In
When Your Parents Move In from Business Week was the basis for this article. Be sure to read it for an excellent example of how the intricacies of having parents move in with you can work out.
This article is for informational purposes only. Consult a personal finance professional in the appropriate field for more information and/or advice.
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