For many seniors and their families, the question of where to reside in twilight years is complex and emotional. Financial planner DeeDee Baze CFP, fee for service and Enrolled agent, brings her expertise and perspective to the table, as she unpacks the pivotal financial planning between aging in place and senior living options. As we recently gathered for our Virtual Senior Care Summit, DeeDee will highlight the crucial step of meticulously planning and, more importantly, discussing these choices with a trusted financial advisor providing education with her presentation, Disclaimer: This presentation and blog post is not intended to be financial advice but for educational purposes only.

Navigating this stage in life requires more than calculations—it demands a blend of foresight, empathy, and financial wisdom. The journey is as individual as you are, and preparing for it hinges on informed decisions. Join us as we delve into this fundamental aspect of senior life, shedding light on a path that’s both financially secure and deeply personal.

Aging in Place:

Aging in place refers to living independently in one’s own home or community for as long as possible with support from family members or professional caregivers. This option allows seniors to maintain their independence and stay connected to their community, but it also comes with challenges such as finding reliable caregivers and making home modifications to accommodate changing needs. This choice could bring on some tensions as family members assist their aging parents in navigating their care and sharing some of the caregiving responsibilities.

Senior Living 

Options include retirement communities, assisted living facilities, memory care centers, and nursing homes. These facilities offer varying levels of care based on individual needs and provide socialization opportunities that may not be easy to come by while aging in place. However, seniors may struggle with adjusting to a new environment and experience feelings of isolation. Aging adults may become bitter and feel “forced” to leave their home. This is certainly a topic we address often as Nurse Patient Advocates; however it will not be the topic of this blog post today. Here we are focused on how to financially prepare to live out your golden years.

The Importance of Financial Planning:

Both aging in place and senior living options require significant financial planning. DeeDee Baze CFP emphasizes the need for families to discuss these choices with a trusted financial advisor who can help them with estimating costs based on where they live and put a plan in place to prepare for their golden years. During our Senior Care Summit 2024 presentation, DeeDee shared an example of how her software helps individuals plan for future expenses such as healthcare costs or long-term care insurance premiums.

Personalized Advice:

When it comes to making these decisions, every individual’s journey is unique, and there is no one-size-fits-all solution. Families need to consider their financial situation, support network, health status, and personal preferences. A financial planner can help individuals make informed decisions based on their specific needs and goals. Everyone is so different. Needs, assets, access to funds, are all based on each individual or family. There is a lot to consider and a lot at stake.  The sooner you plan the less unexpected surprises that may arise if you feel you are caught short without the funds.  DeeDee shares many different scenarios and ways to create the funds needed to pay for your retirement living. DeeDee also shares a fictitious couple to give you an idea of what the planning process is like.

Self-Care for Caregivers:

Choosing between aging in place and senior living options can be a challenging decision for families. It’s essential to prioritize self-care and seek support from professionals or loved ones during this process. As caregivers, it’s easy to put our loved one’s needs first and neglect our own well-being. However, taking care of us is crucial to providing the best care possible.

What to look for in a Financial Planner:

Credentials Do Matter: As a nurse, this was something we had to learn more about and was very foreign to me. In our research (sources listed below in resource section) when looking for a financial planner for your aging parent, start by looking at their credentials. A good financial planner should have proper licenses and certifications from reputable organizations such as the Certified Financial Planner (CFP) Board or the Financial Planning Association (FPA).

These organizations require rigorous training and ongoing education to ensure that planners are up to date on industry changes and ethical practices. Additionally, check if the planner has experience working with seniors as this will give them insight into common challenges faced by older adults.  A CFP must go through rigorous training and certification that a Financial Advisor does not. 

Financial Advisors mostly focus on wealth building and investments while a CFP or Certified Financial Planner looks at all of your assets and can help you look at the big picture of how you will weather out your golden years financially. CFP as a fiduciary, they are obligated by law to act in your best interest as they manage your assets or money.

Fee Structure: 

Financial planners typically get paid in one of two ways – through commission or fee-only services. Commission-based planners receive commissions based on products sold to clients, while fee-only planners charge clients directly for their services. While both models can work well depending on your situation, fee-only planners tend to be more transparent about fees upfront and may be more focused on overall financial planning versus selling specific products.

Also pay attention to the funds you are being recommended. For example, some financial planners may use funds that may have fees each month going to the financial planning firm not just with a transaction. This is one thing to consider when choosing. How is the financial planner making their money?

Specialization in Elder Care: 

It’s also worth considering whether the financial planner has experience working with elderly clients specifically. Managing finances for seniors often requires specialized knowledge of healthcare costs, social security benefits, and estate planning strategies that can differ from those used for younger individuals. A planner who specializes in elder care can provide invaluable insight into these unique challenges and help your aging parent make informed decisions about their finances.

Enrolled Agents (EAs) are tax professionals who have passed a rigorous three-part exam administered by the IRS. They are authorized to represent taxpayers before the IRS in all matters including audits, collections, and appeals. EAs are also required to complete 72 hours of continuing education courses every three years to stay up to date with changes in tax laws. Financial planners with this credential are a double dip as they can assist in planning financially as well as knowing how your plans will impact you with your taxes.

In addition to Enrolled Agent credentials, there are other factors you should consider when choosing a financial planner for your aging loved one. Look for someone who has experience working with seniors or retirees, as they will understand the unique challenges facing this demographic. You should also choose someone who is fee-only rather than commission-based, as this reduces the risk of conflicts of interest.

Communication is Key: 

Finally, it’s important to choose a financial planner that communicates clearly and effectively with both you and your aging parent. Good communication ensures that everyone involved in the planning process understands what’s going on and feels confident in the advice being provided. The right planner should be able to communicate complex financial concepts in a way that’s easy for your loved one to understand while also keeping you informed of any changes or updates.

Conclusion:

Choosing a financial planner for your aging loved one is an important decision that requires careful consideration. By choosing someone with Enrolled Agent credentials and experience working with seniors, you can rest assured that their finances are in good hands. Remember to look for someone who is fee-only and communicates clearly, and don’t be afraid to ask for referrals from friends or family members. With the right financial planner, you can ensure that your loved one’s golden years are financially secure.

Thanks for stopping by and spending a few minutes with us. We hope you join us at our Senior Care Summit 2024 where we are bringing together senior resources necessary in planning your golden years positively and prepared!

Take care,

Pam and Linda

Your Nurse Advocates

“Compassionate Care for Aging Parents and Peace of Mind for Adult Children.”

Resources

Your Nurse Advocate Senior Care Summit 2024

Your Nurse Advocate Free Resources

DeeDee Baze, CFP and EA Free Book Soul-Based Financial Planning

https://www.businessinsider.com/personal-finance/financial-planner-vs-financial-advisor

https://money.usnews.com/financial-advisors/articles/cfp-vs-cfa-whats-the-difference

https://www.irs.gov/tax-professionals/enrolled-agents/enrolled-agent-information \

https://money.usnews.com/financial-advisors/articles/are-you-overpaying-for-your-financial-advisor

https://www.investopedia.com/articles/stocks/09/reasons-to-avoid-index-funds.asp