Transcript | Life transitioning for caregivers

Sarah Widmeyer 0:16 

Welcome to Conversations on wealth, a podcast dedicated to helping Canadians navigate the complexities of your wealth with a multi dimensional approach to planning and wealth management. I'm Sarah Widmeyer, SVP and head of wealth strategies at Richardson Wealth. And today we're discussing some of the challenges faced by adult children or caregivers, and sometimes both have aging parents and how to transition them from home to retirement residence. Joining me once again, is life transition specialist, Matt DelVecchio, president of Leanna, senior transition support.


Matt Del Vecchio 0:53 

Thanks for having me back, Sarah.


Sarah Widmeyer 0:54

So glad to have you, Matt, many of our aging parents may be of the silent generation, raised during wartime and taught to never waste. This mindset has stayed with them to adulthood, and they often refuse to spend their money on themselves. This is a bit frustrating for those of us who are their children or caregiver and want them to enjoy their retirement. Why is it such a challenge for aging parents to spend their money?


Matt Del Vecchio 1:24 

We see this all the time. And, you know, it is a generation of savers, not spenders. So think about it, you know, we're usually talking people born in their 20s and 30s, and maybe even early 40s. Where do they come from? We were talking war time, Great Depression, they were brought up to watch every penny. And so it's completely understandable that this is a difficult topic, to be able to spend money because it's just not in their DNA. And another important factor that many faces, will I run out of money? You know, this is always on the it's everyone's natural concern. But as we age, when we start to spend a little bit more, boy, will I run out of money. So it's understandable that it's it's challenging to get parents to spend their money?


Sarah Widmeyer 2:13 

Yes. And I think it's a universal concern, whether you have 10,000 100,000 A million or $10 million in the bank, the consistent concern is will I outlive my money. So what are some of the big expenses that adult children or caregivers of aging parents should plan for?


Matt Del Vecchio 2:33     

We have to assume with life transitions, there are going to be increased health care expenses. And it's inevitable, especially as we age. And so we have to break it down. The process of life transitions usually is aging in place, we want to try to age in our own home in our own condo as long as we possibly can. So that being said, what type of expenses will start to increase one, I will start with home adaptation. You know, if you want to stay at home, but you've got some mobility issues, you may have to start adapting the home from a simple adding railings to stairs, both sides, bathtubs, you know, some are going into walk in showers, if they had a full bathtub and getting that whole thing converted. For those that may be completely mobility challenge. We've seen increases in stair lifts. Yeah, you know, to go up and down the stairs. So home adaptations, you might want to wrap now outside or reduce the stairs even in in the kitchen, or in the bathrooms or widening doorways. So we can expect some expenses for home adaptation. We can also expect expenses for additional home care. You know, we all know where you know, we've got our health care system, many are saying is broken. And I quite frankly happen to agree with it, you may be able to get some home care from government funded agencies. But it's never enough. And I'm difficult, it's difficult challenge you right takes time. If you get any and this is country wide, it's not just provincial. So you will most likely have to dig into the pocket for some additional private homecare to support aging in place. If it gets to a point where it's just no longer feasible at home. Well, now we have to look at a whole other additional expense into retirement living in retirement homes. And it could be anything from independent retirement homes, all the way up to long term care homes. So you know, it gets to be quite expensive when we start looking into these additional expenses.


Sarah Widmeyer 4:37 

So Matt, then what are the potential costs that should be considered for the second half of retirement? And what are the conversations we should be having about the care cycle now?


Matt Del Vecchio 4:48 

Yeah, so I'll expand a little bit on these two options of home care or even senior living communities but I want to add an additional cost consideration and that is the caregiver. So time and time again, we've seen caregivers that have taken some time off work, or even quit their jobs. What is that financial cost? You're giving up not just the revenue from the job itself, but maybe career development. Maybe in 10, 15 years from now, you won't be earning the same amount that you could have if you kept your job. So this is just a sidebar factor that has to come into the equation. But specifically, if we talk about costs for mom and dad, if we started home, and we want to get some additional homecare, just to throw numbers out there, across the country, we're looking somewhere in the 30 to $40 an hour range if you want to hire private homecare agencies. So just to throw a few numbers, say four hours, only four hours a day, seven days a week, we're up in the $1,000 a week range, or $4,000 a month range. So it could add up real quick. Now let's look at see living communities, and retirement homes will be a little less expensive than long term care simply based on the fact that there's less labor less care involved, but retirement homes can run you anywhere from three to $6,000 a month, it will depend on whether you're getting meals or not or how much care Long Term Care, you're gonna be looking 567 $1,000 a month. Just last week, we had a client go into beautiful residence, and it was just over $10,000 a month. Wow, big dollars. But I want to address just that point, because we are talking big dollars and and certainly not for everyone. All the more reason talk to your wealth planner, look down the road, this is the second half of retirement, a little phrase I use is you usually spend less in the first half of retirement, and you usually spend more than you're expected in the second half of retirement. Okay. So $10,000 a month, this is just craziness. So to get the family's perspective on what we hear, usually the way to justify that the families are telling me Look, dad had his own business, mum worked so hard for a whole life. You know, we don't know is there one year left five years left, it's not going to be unlimited. We have some means. And let's justify it. They deserve it for themselves at the sacrifice of an inheritance. But mom or dad deserve it. They've worked hard, they took care of us. And this is what I'm hearing. When you hear these very large amounts of retirement living and how could they justify? It's because of the they don't want their mom or dad in that institutional government funded public facility. And they're justifying it that they deserve the best. And quite frankly, if you have the financial means, yes, it may be a real stretch. But if you look at it and break it down by years, and not decades, we're seeing a lot of fallacies. Boy, they deserve it.


Sarah Widmeyer 7:57 

Yeah. Yeah, then that is the decision that we made personally, my parents saved and worked hard and saved. And so even though she wouldn't consent to it, we made sure that she got the best that we could get for her. And so you know, she's able to get her hair done every week, she's able to enjoy great meals and great excursions. And, again, you know, the relief that you feel, knowing that she's well looked after she's busy, she's getting socialization, she's getting care, she's getting all of the things that meant something to her, like her hair looks good, her nails look good. This is what's happening. And we're happy that she's able to experience that


Matt Del Vecchio 8:41 

Good for you and good for mom, too. She feels good about herself. And then that doesn't go away.


Sarah Widmeyer 8:46 

That doesn't go away. No, that doesn't go away. So what are some of the ways then that we can coach our parents to consider spending their money in a healthy way?


Matt Del Vecchio 8:56 

You absolutely want to start this process early by planting seeds. There is a lot of denial and resistance. But when you do have these conversations and you're planting seeds, it enters their mind. They may not admit it, but it's there. So start these conversations early how when you're discussing tough decisions, tough subjects, such as wills, advanced care directives, Power of Attorney crucial discussions, these are conversation starters that you should be having little difficult and sensitive, but you should be having those and ask them. What do they want? If care starts to increase? What would they want? And this is a very why the answers we get are like all over the place. It's very personal. It's very cultural. Yes. I've had some situations where I don't want to be a burden on you. Yeah, like a no. So do what we have to do. You know, I'm okay going somewhere that's going to take care of because I don't want to burden you. And I've had the other extreme.


Sarah Widmeyer 9:56 

We got both. We've got we don't want to burden you Don't spend the money.


Matt Del Vecchio 10:03 

And I also hear listen, I took care of you for a lifetime. And it's our culture, we take care of our parents, you're going to take care of me. Those are tough ones. But it's reality. So you should have these conversations. And if it's one of those that you're going to take care of me. Now, you have to ask yourself, what can the caregiver or the adult children realistically do? If you're still working, supporting a family, you have your own children issues, you have to communicate this and have this to a conversation? And I think probably the most important point, okay, let's call it like it is, at what point in time mom or dad? Do you think it would be an appropriate time to transition to senior living community, and this could be for five years before this actually happens. But it's a way of having that conversation to make people start thinking,


Sarah Widmeyer 10:53 

Yeah. And so on that line, then, as we're starting to plant the seeds with our parents and starting to have those conversations. At the same time, I think it's really important to have these discussions with your wealth or financial planner, both as an adult child, but also as the actual aging parent, those conversations need to start, you know, years before retirement, but also they're important conversations to have with the adult children as well, in terms of financial planning.


Matt Del Vecchio 11:25 

Absolutely. It's so important, because the unknown, creates fear and anxiety. And here's where your wealth planner can play a really significant rule. Most people will assume I'm going to run out of money, I have to hold on to it for as long as I possibly can for just in case, well, many cases. This is just in case. Exactly. So you need to sit down with your wealth planner, have them do a three year five year a 10 year projection. I've seen it time and time again. And you get all the reports. And all of a sudden in most cases, and sometimes you're financially strapped and you can't in most cases, I had no idea. You know what, I'm going to be okay for the next five or 10 years, even if I do go to senior living community, but just the fact that they've heard it from their wealth planner, and they see it in writing that sense of relief, I see it time and time again. So the Goodwill's planners are going to have these discussions. It's not all about what's the return on my investments this quarter. Know, the Goodwill's planners are challenging. They're having open discussions, what if questions, talking to the children if they can as well talking to mum and dad, doing some objections and say, what if, but we need to be prepared? And through those conversations we usually hear okay, let's do a little projection. What can I truly afford? And will I run out of money? Or am I okay,


Sarah Widmeyer 12:54  

Right? Yeah, crucial, crucial conversations to have and the earlier the better,


Matt Del Vecchio 12:59 

or you're better and you know, the value of the wealth plan are so important. And I mean, just look at us. We're here, Richardson  Wealth, hats off to you. I mean, you're doing podcasts on these discussions, and you're really getting the word out. And it's a difference maker. It's not all about what's the return this quarter, and it is so holistic, the approach you're taking, I think your clients will really appreciate that.


Sarah Widmeyer 13:21 

The fundamental question is, what's the money for? What's the money for? And it's an important question to ask yourself, and it's important question to ask your parents, then you'll start to hear things well, you know, for comfortable retirement well for passing on to the next generation, well, for just in case, into your point, pull the lever now it's just in case. And yeah, so what's the money for it's not the investment returns in the indexes, returns and all that sort of stuff. It's really all the stuff that happens outside of the balance sheet. That's important. That's what the money is for.

So I believe we're coming up to our end of time here, man, do you have any other closing thoughts you'd like to share?


Matt Del Vecchio 14:18 

Well, I probably just add with life transitions, you need to expect the unexpected, things are going to change, and you need to be able to adapt. And I'll leave it with the topic of spending money. And I usually do a little bit of exit interviews with some of our clients. And I said, Any regrets? You know, they're moving and they're later on in life. And the common one I get besides, of course, I work too hard. I you know, I didn't really spend time with my kids. And so when the common one I get is I should have spent my money a little earlier. I should have traveled when I could because now look, I'm in a walker, or my husband has Alzheimer's and we just can't do the things. So because of that, you know, saving Things saving savings attitude. You do need to reach a point where it's okay to spend your money and enjoy life because it flies by and before you know it, you're not able to enjoy life as much. So spend the money when you can.


Sarah Widmeyer 15:12 

Yeah. Thank you. Thank you to our special guest, Matt Del Vecchio, for joining us today for such an important conversation. It's always a pleasure to talk with you. Thank you. If you'd like to learn more about how Richardson wealth can help you navigate this important life transition, you can visit our website at Richardson wealth.com. You can also follow Richardson Wealth on LinkedIn or Facebook for a wealth of information on many planning topics including this one.