are many ways your life will change if you step into the role of caregiver, especially if you assume a caregiving role from within your own home when a parent comes to live with you. Your job, finances, and social life will be impacted. Your ability to travel, your emotional well-being, and your retirement dreams will be impacted. That sounds like a lot, but know that with good planning, that impact will feel far less overwhelming.
Remember that despite the challenges, there is a great feeling of satisfaction in knowing you are taking care of a loved one and helping him or her make the most of his or her later years in a safe and loving environment.
Another of my cherished clients, Dawn, went through this caregiving process with her mother not so long ago. Her mother was diagnosed with pancreatic cancer, and while many patients with this diagnosis live less than 12 months, Dawn’s mother lived another 5 years. Since Dawn was told of the short time frame expected, she willingly took on the full caregiving responsibilities for her mother, assuming that her mother did not have much longer to live.
While her mother enjoyed much better health in years three and four — thanks to remission and pain control — Dawn still experienced a lot of mental and physical fatigue in those five long years. Thankfully she had a very supportive husband who helped keep her from “losing it” or throwing in the towel, and little did they know that all the while, he was learning from her example and would use that knowledge to assist his own ailing mother shortly thereafter.
Finding a healthy balance between the rewards and the challenges can be done with awareness, diligent planning, and preparedness. There is still time to build a solid financial plan that will allow your parents to be taken care of in their home as long as possible, and in the facility of their choice, in the style and manner they wish, when the time eventually comes.
There is still time to ensure that your retirement dreams can come true as well. Most importantly, there’s no time like the present to get started. In the next Chapter, we’ll discuss how planning starts with you and your own retirement readiness.
1. Names and case details have been changed to protect the clients.
Chapter 2
Taking Care of Yourself First: Preparing for Your Own Retirement
If you have ever been on a plane, you’ll remember the many times you’ve watched the flight attendants demonstrate emergency procedures. One of the things they always remind us to do if the oxygen masks drop down from the ceiling is to put our own mask on first, before we tend to our children and loved ones. While it is often in our nature to feel that we should help our loved ones first, it can be dangerous to do so in this instance. This is because we can’t help others breathe if we aren’t breathing ourselves. The same is true when it comes to retirement planning. We must first safely set ourselves up for success before we will be in a position to help others.
You have an obligation to ensure you will be self-sufficient in your retirement years. This means balancing your own needs with those of your children and your aging parents.
1. Is It Time for You to Retire?
Just because you have reached a particular milestone, such as years of service or age, it does not mean you have to retire. If staying in the workforce is still rewarding — even for an extra year — it can give you great financial benefits, as well as provide rewarding mental and physical stimulation. However, it is important to consider what your retirement lifestyle dreams look like.
Today’s active retirees may find they spend as much money (or more) during retirement as they did while working! The old-age stage has its expenses as well, such as moving to assisted-living residences or long-term care facilities. It’s time to really think about your hopes and dreams, and make a list of the types of activities you want to participate in throughout your retirement, from travel, to dining out, to club memberships, and more.
In addition to lifestyle expenses, think about whether you will be financially supporting a spouse or an adult child at the time of your retirement. As we’ve discussed already, there may be a likelihood that you will need to help your aging parents if they do not have sufficient funds.
Theravive, a network of counselors and clinics throughout North America, estimates that 33 percent of adult children who are caring for their aging parents are either retired or work part time.[1] This means by financially helping others, it will have a dramatic impact on your income needs.
No matter what age you are now, it’s not too late to save adequately for retirement. The following sections list helpful tips to get you started.
1.1 Tips for 50-year olds
If you haven’t yet given serious consideration to your retirement, now is the time. At age 50, there is still time to plan and save for retirement during the next 10 to 15 years. With children now leaving the family nest, and careers in full bloom, expenses are lower and income is on the rise. This is the time to take advantage and reduce your debt as well as increase your retirement account savings.
1.1a Tip 1: Paying down debt
It is very difficult to enjoy retirement when a large portion of your fixed income will go to servicing debt — especially debt accumulated during the working years! Pay off debt with the highest interest rates first, such as credit cards. Did you know that over one year, a $5,000 credit card balance with an 18 percent interest rate (a typical rate for a credit card) would cost you $900 in interest?
Once your consumer debt is paid off, it is time to reduce or pay off the remaining mortgage you have on your home or cottage.
1.1b Tip 2: Start saving
Your 50s are the ideal time to top up your registered retirement accounts (e.g., Registered Retired Savings Plans and Tax-Free Savings Accounts). This is especially true if your earnings are near their peak, since those higher earnings are taxed at a higher income tax rate!
1.1c Tip 3: Protect your family
With the children grown and gone, debt paid
