A Little-Known Benefit for Aging Seniors

The U.S. Department of Veterans Affairs has a government benefit that covers the costs of caregivers, assisted living or a nursing home.   The benefit is known as Aid and Attendance or A&A and is available to qualified war era veterans and surviving spouses.    Surprised that you’ve never heard of it?  You’re not alone, it’s probably one of the lesser known benefits.

For a well-kept secret, it’s a wonderful benefit.

Financial Abuse of Elderly Parents

Elder Americans were robbed of an estimated $4.0 billion in 2013.   Some have called elder abuse “the crime of the century”.  Seniors who lose their money are more likely to go into a nursing home, go on Medicaid, or suffer severe depression.  And, once an older adult has been ripped off, he or she is likely to succumb to other fraudulent financial schemes.

Here are nine warning signs to watch for in older adults which may indicate financial abuse and exploitation is occurring: 1) taking a large amount out of the bank or other cash accounts, 2) making numerous withdrawals of smaller amounts – say $100 at a time, 3) writing a large check to someone they do not know, 4) changing power of attorney or beneficiaries on insurance or investment accounts, 5) bouncing checks or bills going unpaid when there should be enough money to cover bills, 6) making unusual or unnecessary purchases (i.e. golf clubs or jewelry), 7) agreeing to make unnecessary home repairs, 8) becoming too close with a much younger person or an inappropriate person, 9) having a caregiver that is too interested in the finances.

Increase Your Social Security

Most everyone worries if they will have enough income at retirement and Social Security is one of the  pillars needed  for a comfortable retirement.  One of the biggest mistakes we often make is collecting social security at age 62.  That mistake alone can cost over hundreds of thousands of dollars.  The reason? By waiting until age 70 to collect your social security benefits you are increasing your payments dramatically.

Every year you delay collecting, to generally age 70, you are increasing your benefits by 8%.  Where  else are you going to get a guaranteed 8% return.  Before making a decision consider this.

  1. Your life expectancy. At age 65 men live to be 82 and women to be 85.  Everyone is different. Make your decision based on your own situation.
  2. Your marital status. If your single and are seeking to gain as much as possible from the system then at age 80 all options and the cumulative benefits are all equal. But after age 80 if you waited to age 70 your benefits will be paid at the higher amount, whereas, I would remain at the lower amount from collecting at age 62.
  3. Your income. If married and both of you work, one earns substantially more, and you expect at least one of you will live to age 80 then the high wage earner should wait and the other start collecting, if needed.  Added benefit: If the high wage earner should die first, the surviving spouse benefits can take all of his benefits instead of hers.

Knowing When To Oversee Mom’s Money

It’s not easy becoming the financial caregiver for an aging parent.  Often the adult children take on this role slowly over time and reluctantly.  Far from being a simple job a financial caregiver must act prudently and in the best interest of the person.  Mistakes and financial disaster can happen especially if you are also tending to the aging parent’s health and other needs.  Horrible stories are often heard of family members, caregivers and others who financially exploited aging seniors.

It’s critical to understand the fiduciary responsibility you are assuming by becoming the financial caregiver.  Frequently you will need to manage the finances even more closely than your own.  Keep good records, account for all sources of income and expenses, maintain adequate insurance, timely pay all bills and taxes, and make certain all investment decisions are made wisely.