Not many couples are emotionally or financially prepared to take care of their parents as they age, and being placed in this position can be incredibly onerous and burdensome. With advances in medicines and technology, our parents are living for longer – often with chronic ailments and conditions that require experienced care and/or nursing. Care assistance of any form is expensive and, if these costs haven’t been provided for in your parents’ retirement plan, the financial and practical responsibilities will naturally fall on you and your siblings. Given the high cost of care, medication and medical treatment, it helps to know in advance if you will be required to assist your parents as they grow older. However, in addition to the actual cost of care, there are many other cost factors that need to be considered and taken into account when doing your own financial planning exercise.
Caring for an elderly parent can be physically and emotionally draining especially as illness and age rob them of their faculties and their ability to perform acts of daily living. If you’re caring for an older parent, you may at the same time be facing competing demands from your spouse and children. Being pulled in multiple directions is not only emotionally taxing – it also impacts on the time you have available for your own job, career or business. Very often, caring for an aged parent has a direct impact on your ability to earn an income at a time when generating an income is critical to the survival of the broader family unit. However, it’s not only the time off work and its subsequent impact on your income that needs to be considered – it’s the longer-term loss of career advancement, business growth and your would-be income trajectory that you also need to take into account. Depending on your parents’ medical condition and ability, caring for them can become a full-time job which gets more challenging as their health and faculties deteriorate. Not only can this affect your mental well-being in the form of stress, sadness and frustration, it can also affect your physical well-being, especially if you are caring for your parent hands-on. Specifically, carers of the elderly often suffer from recurring headaches and back problems.
With the cost of private nursing and frail care being unaffordable to most South Africans, many choose to have their aged parents live with them which often requires renovations and/or structural changes to the home in order to accommodate the elderly parent’s specific condition. Although this is generally a more affordable option than financing monthly frail care costs, building is expensive – especially if you are required to make customised changes to your home – and you will need to factor these costs into your planning. If your parent suffers from a physical disability or impairment, you will need to consider the costs of installing ramps, making bathroom modifications, installing non-slip flooring, widening doorways to accommodate wheelchairs or walkers, and/or installing panic buttons. Besides for the financial costs, you also need to consider the emotional cost of bringing an aging parent into the family home and the extent to which it will impact on your family unit. For instance, if you are not at home, your teenage children may need to take over the care of your parents and this, in turn, can affect their freedom of movement, studies and ability to socialise with their friends.
If your aged parents are financially dependent on you, you are able to add them to your medical aid as adult dependants. Medical aid coverage for your parents is expensive, especially if they have not belonged to a medical aid before or have had a break in their membership, in which case they will have to pay late joiner penalties. When choosing a medical aid for your parents, give careful thought to their specific medical condition and their healthcare history, their financial position, the facilities that are close to them, and what cover would be most appropriate for their needs. The cost of medical aid and healthcare increases year-on-year by around inflation plus 4% meaning that, as your parents age, their healthcare costs will become an increasingly larger portion of their overall spend. While comprehensive medical aid coverage is advisable for the elderly, this is not always financially possible. Anything less than a comprehensive medical aid will mean that you may be liable for co-payments and the cost of treatment not covered by the medical aid, which can include scans, scopes, x-rays, medication and associated healthcare services such as physiotherapy and rehabilitation.
Providing for the daily living costs of your elderly parent – whether part or in full – can be enormously expensive. Besides for costs such as groceries, toiletries and fuel, there are numerous other costs that need to be considered. The cost of home care or nursing will depend on the specific need of your parent. Care providers generally set their rates according the type of care required which can range from basic companionship to frail care, dementia care, caring for the disabled, and post-operative care. Full-time private care can cost anywhere between R10 000 and R40 000 per month, or higher where specific nursing experience is required. If your aged parent requires intensive post-operative care, they may require a stay in a step-down facility which effectively bridges the gap between their stay in an acute hospital facility and their move back home. While some medical aids provide cover for step-down care, this is very often limited to major centres and you may be required to cover the costs of this type of care.
Over and above physical care, medical appliances and equipment can be huge cost-drivers for the elderly. Mobility aids such as wheelchairs, walking frames and scooters can be particularly expensive and are very often only partially covered by an annual limit on medical aid. Similarly, spectacles, hearing aids and dentures can be big cost drivers for the elderly and are generally not adequately covered by medical aid. Other devices that may be required include shower rails, commodes, and /or bath and shower chairs. Special mattresses, adjustable beds, and patient lifters may also be required, all of which come at a price. Blood pressure machines, diabetes kits, oxygen concentrators and nebulisers are just some of the appliances you may be required to buy, bearing in mind that these will be over and above the costs of chronic medication, nutritional supplements and over-the-counter medicines.
As your parents grow older and their health deteriorates, the physical, emotional and financial costs of caring for them can have significant implications for your own financial planning and retirement. If you’re unsure about your parents’ retirement funding position, make time now to have those difficult conversations about their future care. Knowledge is power, and the sooner you know that you may need to contribute towards your parents’ care the better positioned you will be to plan accordingly.