For most older people, the fear of outliving their money ranks right up there with having to move out of their homes. If you find out your parents are in financial trouble, here are some things to look at to determine your next step.
First is to determine the source and amount of their income. Second, list their monthly payments. See what can be eliminated. If they have used all their savings and investments, check for maintenance fees on those accounts. Be sure to check for penalties on CDs or annuities before you close all accounts that are empty or nearly empty. You may find your parents have several checking accounts that are charging a service fee. Except for unusual circumstances, they only need one checking account at this time. Unless they have told you in so many words, this may be when you find that your parents are living on social security income and the bills are not being paid.
Scrutinize their health care plans. If they are on Medicare and paying for a medicare supplement, go online to www.medicare.gov or talk to an agent about other options. They are available and can save a ton of money. If one of your parents is a veteran, see if they qualify for veteran's benefits. See if there are life insurance plans that could be cashed in. Many parents balk at this until they realize their lifestyle will have to be subsidized by their children.
Check into a reverse mortgage. Your parents could be living off the equity in their home. That, combined with social security could save you and your family from having to pony up the money to keep them going. Downsizing, if they haven't already done so, could be the only other option to keep them living on their own.
Ideally, expenses can be eliminated and living arrangements altered enough to provide relief from expenses. If your own finances or other siblings are not in any shape to take on the extra burden of helping your parents, qualifying them for state run medicaid is the final option. But that's another blog.