Caring for aging parents is a profound act of love — but it often comes with emotional and financial complexities. For adults in their 40s, 50s, and 60s, supporting an elderly parent can mean balancing caregiving with career demands, retirement planning, and perhaps even college tuition for their own children. This “sandwich generation” faces real pressure — and without a plan, the financial strain can escalate quickly.
At Connect Wealth, we help families prepare for and navigate this season with thoughtful, forward-looking strategies. Here’s how to begin.
1. Start with Open and Ongoing Conversations
Financial planning starts with transparency. It’s important to understand your parents’ current financial situation, including:
- Income sources (Social Security, pensions, annuities, investments)
- Monthly expenses
- Long-term care insurance (if any)
- Existing debt
- Estate planning documents (wills, powers of attorney, health directives)
These conversations can feel uncomfortable — but they’re essential. A 2023 Fidelity study found that over 70% of adult children and their parents misunderstand each other’s expectations when it comes to financial support and care planning.
Tip: Frame the conversation around planning with them, not for them. That collaborative tone makes a big difference.
2. Understand the Cost of Care — and Plan Ahead
Caring for aging parents often introduces new and sometimes unexpected expenses. These can include home health aides, assisted living, nursing care, transportation, and home modifications. While costs vary widely based on region and level of care, they can rise quickly — especially in more affluent areas.
For context, Genworth’s 2024 Cost of Care Survey reports that national median monthly costs now start around:
- $5,000+ for in-home care
- $5,600+ for assisted living
- $9,500+ for a private nursing home room
But in high-cost-of-living areas, these numbers can be significantly higher — and may increase each year due to inflation and demand.
Even part-time support or gradual care needs can strain a retirement plan if not proactively accounted for. That’s why it’s important to incorporate potential care costs into your broader wealth planning strategy, especially if you’re balancing support for both parents and children.
3. Explore Tax Breaks and Government Programs
There are several ways to reduce the financial burden of caregiving:
- Dependent care credit: If you claim a parent as a dependent, you may qualify for tax credits.
- Flexible Spending Accounts (FSAs): Some employers allow you to use FSAs for elder care expenses.
- Medicaid: For parents with limited assets, Medicaid may cover nursing home care and some in-home services.
- Veterans benefits: If your parent served in the military, they may be eligible for additional aid through the VA.
An experienced advisor can help you identify and qualify for available programs — and build them into a sustainable plan.
4. Protect Your Own Financial Future
One of the hardest truths about caregiving is that people often sacrifice their own savings or retirement plans in the process.
Before you make large financial commitments to a parent’s care:
- Reassess your retirement plan and timeline
- Understand how much you can realistically contribute without derailing your own future
- Consider setting boundaries — emotional and financial — as part of your caregiving plan
As AARP often notes, caregiving is a marathon, not a sprint. Preserving your health, wealth, and energy is key to staying present and effective over time.
5. Formalize a Family Plan
If you have siblings, extended family, or other stakeholders involved, put agreements in writing. This reduces stress, confusion, and potential conflict later.
Your plan might outline:
- Who manages bills and medical decisions
- How caregiving tasks or costs are shared
- What happens when needs escalate (e.g., transitioning to full-time care)
An estate attorney or financial planner can help formalize roles and responsibilities — especially when assets are involved.
6. Update Legal and Estate Documents
If your parents become unable to manage their own affairs, you’ll need proper legal authority. Make sure these documents are current and accessible:
- Power of attorney
- Health care proxy
- HIPAA authorization
- Will or trust documents
- Long-term care or life insurance policies
These steps may feel administrative, but they’re a critical part of protecting your parent’s wishes — and your peace of mind.
You’re Not Alone — And You Don’t Have to Figure It All Out Yourself
Supporting an aging parent can feel overwhelming. At Connect Wealth, we’re here to guide you with empathy and expertise. We help clients plan for care costs, protect their own financial goals, and coordinate family conversations around caregiving and legacy planning.
Because financial planning isn’t just about spreadsheets — it’s about family, dignity, and preparing for what matters most.