What Is an Eldercare Financial Planner and Does Your Parent Need One?

The Squeeze

• Eldercare financial planners (EFPs) often specialize in supporting older clients and their unique needs and concerns.
• An EFP can help an aging parent manage assets over the long term, including developing a monthly budget and yearly financial plan.
• They can also help create a financial retirement plan to cover long-term care costs for an aging parent.

Budgeting can be tricky, even for the most disciplined among us. Imagine trying to do so when you’re getting by on a fixed income or Social Security — as a retired loved one in your family or parent may be doing. Even if your elderly parent managed to squirrel away a reasonably comfortable retirement nest egg, it could be challenging to use the money judiciously, to ensure that it lasts as long as needed. 

Now, what if something were to happen and your elderly parent suddenly needs long-term care? Who would sort through all of the costs and options associated with necessary comprehensive care and develop a workable financial plan to manage the expenses on an ongoing basis? How about identifying public resources your family may be eligible for and finding ways to maximize your parent’s available assets?

These are just a few of the reasons why your parent — and you — may need an eldercare financial planner (EFP). Here, we rundown a few ways that this type of professional can help your parents and you.

What is an Eldercare Financial Planner?

With life expectancy improving with each new medical advance, individuals who retire at 65 can live as many as 20 or 30 years or more. Determining how best to manage financial resources to adequately provide for such an extended period — i.e. navigating longevity — can be daunting. 

That’s why a growing number of financial advisors nationwide have begun focusing on elder-care planning as a primary offering, providing services that expand beyond traditional retirement planning or wealth accumulation. Called EFPs, these professionals specialize in geriatric financial support services, meaning they have expertise and knowledge in serving older clients and their unique concerns and life needs.

EFPs can come from many backgrounds. Some are educated as Certified Financial Planners (CFP), personal financial specialists or even chartered financial consultants (the designation for insurance agents), while some may also be registered as financial gerontologists through the American Institute of Financial Gerontology.

What types of services can an Eldercare Financial Planner provide?

As you search for an eldercare financial professional, you may find they are referred to by various titles, including EFP, eldercare financial consultant and financial gerontologists. Often the services these individuals provide vary slightly depending on the specific title.

For instance, financial planners generally provide more comprehensive services, such as creating detailed financial plans to address how your aging parent will manage assets over the long term. They can also help identify all costs associated with care options should a long-term program be needed. 

As notes the PBS series Caring for Your Parents, a thorough financial plan for an elderly parent should also include such things as a monthly budget for income and expenses, a budget for large capital expenses, a review of health insurance plans (including understanding what is covered and what is not), and an overview of all assets. An EFP can help address each of these daunting tasks, but may also offer advance planning for incapacitation and even create end-of-life plans.

By comparison, eldercare financial consultants may have many of the same professional qualifications as planners but typically will provide more limited services. For example, instead of developing a detailed financial plan for your parent, they may simply offer guidance on such issues. After which, your elderly parent or extended family would need to complete the comprehensive plans on their own. Working with a consultant instead of a financial planner is that their services may be less expensive, which can be particularly important if budget is a concern.

Additional ways EFPs can support your parent 

The services outlined above are just the tip of the iceberg when it comes to the ways an EFP might help your parent and your family. As Guy Clanton, senior financial planner with Truepoint Wealth, explains, there are many other reasons why you might consider engaging the services of such a professional. These include:

• Protection from financial elder abuse. From a monetary standpoint, than EEP should create procedures and stop gaps to help prevent any unauthorized transfer of funds should a senior inadvertently share information with the wrong person or entity. 
  “Elderly individuals, women especially, are the most preyed upon group, and it could be the result of not asking enough questions or even something like loneliness that could prompt them to speak to someone who has bad intentions,” explains Clanton. “An EFP would be trained to spot behavioral characteristics such as fear, withdrawal and panic, which could pinpoint elder abuse.”
• Impartial moderator. An outside financial professional such as an EFP can also provide support during family meetings or discussions surrounding sensitive financial questions to ensure that the wishes, intentions, and logistics of the elderly individual are communicated to all family members. 
  
  “This is particularly useful as far as preparing family members for respective roles and hopefully ensuring the process goes as smoothly as possible,” says Clanton. “This would be vastly different from a situation where no one communicates, and then all of sudden people find themselves immersed in a complicated, stressful situation.”
• Reviewing estate-planning documents. An EFP can also check key estate planning documents for an aging parent, ensuring they are current and correctly reflect the individual’s wishes,” says Clanton. “If these documents are not yet in place, the EFP would be able to help get them executed through a qualified estate planning attorney.” 

Long-term care financial planning

One of the most significant roles an Eldercare Financial Planner can play is to help an aging parent (and extended family members who provide support for the parent) sort through long-term care options when the time comes. This is a cumbersome task, and an EFP should have experience in this area and be able to expertly explore the costs associated with various care choices and create an ongoing spending plan for covering expenses. 

“That plan should clearly articulate the client’s spending goals in terms of amount,” says Clanton. “Included in that plan will be a full inventory of all assets—cash, investments, home — and all forms of insurance including long-term care, life, and health.”

The result should be a detailed budget breaking down the client’s spending needs and how they will be paid. Equally important, such a professional can guide clients by identifying public resources that may minimize the use of family funds. In short, this person can be critical when wading through a crucial, complex and costly decision-making process.

Where to start

Eldercare financial planners can be essential when it comes to helping your aging parent sort through challenging financial questions and situations. These professionals can help ensure that your parent has manageable financial plans in place to navigate longevity and have a comfortable retirement and address the financial burden of long-term care should the need arise.

To identify a reliable and trustworthy EFP for your parent, start by asking friends for referrals. There are also various resources online that can help, including industry websites such as the Certified Financial Planners directory, which allows you to sort results by specialties, including Elder Care, retirement income management and retirement planning.

As an aging parent moves through his or her later phases of life, EFPs can be an invaluable part of your family’s support team.