A guide for assisting aging parents with estate, financial and long term care planning

A resource guide for family roles and experts

A part of the Engaging Aging Parents series

With aging parents, it's important to have conversations about their health, wealth and estate before issues arise. A trusted team of advisors can help you assist your parents in making proper, fully informed legal, financial and healthcare decisions.

Your team of advisors

Having a team of advisors that you really trust is important when it comes to the needs of your aging parents'. Here are a few different types of advisors you'll want to consider:

  • Financial Advisor: will organize financial affairs, analyze investments and recommends investment strategies that align with your goals. Your SVB Private advisor will facilitate your parents' planning need and assemble the right team.
  • Estate Planning Attorney: will ensure that plans for asset distribution after death are carried out efficiently, reducing taxes and other costs and avoiding a prolonged probate court involvement. Having an estate plan in place can mitigate estate tax exposure, ease the administration of assets both during lifetime and after death and address any potential incapacity due to illness or disability.
  • Geriatric Care Manager or Visiting Nurse: These professionals can offer solutions and perspective regarding safely caring for an aging parent at home. They can give objective advice and arrange the resources needed to provide high-level care. Additionally, they can assist in making difficult but necessary decisions when it is no longer safe or feasible for your parent to remain at home.

The core estate plan

Below are the key components of a core estate plan:

  • Last Will and Testament: This document lays out how property and assets will be distributed after death and names the personal representative. The will may also name guardians for minor children, if any. Wills speak only to the distribution of probate assets.
  • A Trust (Revocable or Irrevocable): This is a separate legal document that enables the disposition of assets either during life or at death. Trusts can be a very effective tool for the seamless management and administration of assets, to plan for a disability or medical need, to maximize the use of estate tax exemptions and to avoid the probate process. With a revocable trust, the terms can be changed. On the other hand, with an irrevocable trust, terms cannot be changed. However, because the latter transfers the assets irrevocably for the benefit of another, irrevocable trusts can be a useful planning tool for asset protection and gifting strategies.
  • A Durable Power of Attorney: A durable power of attorney grants broad authority, though they can also be used for limited purposes, that remains in effect even if the grantor becomes incapacitated and allows the attorney in fact to step into the shoes of the grantor and act as they would. A power of attorney is one of the primary ways to avoid conservatorship proceedings.
  • Health Care Proxy: A health care proxy is where an agent is named to make medical decisions on your behalf only when you have been deemed incapacitated and unable to make decisions for yourself. A healthcare proxy is one of the primary ways to avoid guardianship proceedings.
  • Advance Directives: Final wishes regarding extraordinary life-prolonging interventions that may or may not be desired will be specified in detail here. A living will is one such type.

Caretaking duties

Regarding caretaking duties, families must consider the needs and wishes of their aging parents and the abilities and willingness of the children or other relatives who will manage their care. Siblings should all meet with their parents to discuss who can take on what specific responsibilities, setting aside assumptions based on gender or birth sequence.

Clear communication will facilitate harmony. The person who lives closest to the parent often oversees the day-to-day caretaking. Since this default may not be sustainable, you and your siblings may want to arrange a rotating schedule or compensate the one who takes on more of the daily duties.

Whether you're having conversations with your parents about their finances now or in the future, having a trusted group of advisors and a plan in place is helpful in ensuring that their legacy remains intact. For more information, visit our Aging Parents Series here.

The views expressed in the article are those of the author and/or person interviewed and do not necessarily reflect the views of Silicon Valley Bank, a division of First-Citizens Bank and First Citizens BancShares, Inc. The materials on this website are for informational purposes only, are subject to change and do not take into account your particular investment objective, financial situation or need. Since each client’s situation is unique, you should consult your financial advisor and/or tax planning professional before acting on any information provided herein.