Challenges of caring for aging parents


9209134_sAdult children don’t want to think about it and, all too often, their parents don’t want to talk about it, however every day, hundreds of thousands of Canadians are suddenly thrust into an unfamiliar world of caring for an aging parent because they have put off planning for the inevitable.

Caring for aging parents can be overwhelming. When an elderly parent is no longer able to be fully independent or needs more help, how do you find out what you need to know to effectively care for them?  Missteps due to lack of knowledge have long lasting, expensive, and even endangering consequences.

If you are an Adult Child, dealing with a senior parent with Chronic Health issues, do you know the steps or resources to guide you and your parents as they age further?

The following are questions you need to find answers to, before a crisis happens:

  • Are you concerned that your aging parent or loved one is no longer safe in their home?
  • Can your parents stay in their home with intermittent care ?
  • Do you know what in home care options and support is provided by the Government, Alzheimers Society, the Red Cross , CCAC -Community Care Access Centers (, the Arthritis  Society?
  • Do they need a retirement residence, now called “Assisted Living”, or a nursing home?
  • Do you need to sell the family home?
  • If so, do you know how much is needed for alternate accommodation including additional heath care costs?
  • What will be the financial burden of caring for an elderly loved one? Are there emergency funds in place if needed?
  • What are the legal issues surrounding handling their finances? Are appropriate Powers of Attorney and Wills in place? NOTE: Did you know if an individual has dementia or Alzheimer’s, these cannot be changed?
  • How do you organize and downsize a lifetime of “things”?
  • If you sell the family home, how do you ensure the proceeds are safe and will last?
  • How do you manage with all the doctor’s appointments and other daily issues?
  • How do you take control after years of your parents doing it all on their own?

Once issues are identified, the first step is to have a family meeting to manage the challenges of aging and work together as a family. This will help you prepare for a more certain future and understanding the full range of issues around your aging parent. It will reduce uncertainties and open up conversations that often lead to positive changes in family dynamics.

Throughout the meeting, it is important to listen. One of the biggest fears of an aging individual is losing independence and familiar surroundings.

Bringing up assisted living may be a difficult one, however initially many families are happy to help their loved one by checking up on them, making meals, helping with the bills, etc. , but as time goes on and lives get busy, this takes a toll.

If a loved one moves into an assisted living community, time can be spent actually visiting, sharing their lives and making new memories together. The change in quality of life can be impactful.

Sometimes people are reluctant to explore senior communities and learn what assisted living is really about. Often they do not know what questions to ask. You need to know all the options that are available so that when the time comes an informed choice can be made. Many facilities welcome visits and offer complimentary meals and even overnight stays.

For more tips to assist you manage the challenges of aging or to sign up for a future seminar on the topic of AGING PARENTS: The Family Survival Guide, contact Heather at or 416-527-2553.

Heather Holjevac is an Elder Planning Counselor and has presented seminars on the topic of AGING PARENTS: The Family Survival Guide with the Alzheimers Society and the Toronto Public Library’s -Ask the Expert Series.

Compiled by Heather Holjevac, Senior Wealth Advisor TriDelta Financial

Leaving money to charity in your will? There is a better way


ted_financial_postI recently met with someone who wants to leave all of their money to two charities. They put this in place because they didn’t have close family members (or didn’t feel the family members needed the money), and they wanted to leave a real legacy to a couple of causes that were close to them.

Their situation was as follows: Age 85. $550,000 in savings (75% non-registered and TFSA). Pensions and RRIF withdrawals totaling $70,000 a year. Living in an upscale retirement residence. Drawing roughly $20,000 a year from savings.

While it seemed like his estate plan made sense, there are better ways to leave that legacy than through a will — ways that could grow the amount of giving by over $100,000.

Here are 3 problems with leaving money to charities in the will:

1. By leaving money to a registered charity you will receive a charitable tax credit of between 40% and 50%. The only issue is that you will only receive the tax credit on charitable giving of up to 75% of your current years’ income. For example, if you make $100,000, you could give up to $75,000 and receive the full tax credit. In your ‘final’ tax return, you will get a credit for up to 100% of your income.

The problem is if you have income of $80,000 in your final return, and leave $800,000 to charity, you will have foregone almost $360,000 of tax credits! If you die with a very large RIF, this may work because your RIF would be considered as income on your final tax return (if you don’t have a surviving spouse). Otherwise, it is a real missed opportunity.

2. Wills with very large charitable giving occasionally are contested by family members who feel that they should have received more. This can cause lots of delays, legal costs and heartache. All can be avoided by giving to the charities outside of the Will.

3. You are paying too much tax. In many cases, this money is getting taxed every year sitting in a non-registered investment account, never being spent. Finally it will go to the estate, and in some cases be hit with a probate fee as much as 1.5%, and then go to the charity.

The best way to avoid these problems is by some blend of giving annually and taking out a life insurance policy with the charity as beneficiary. By giving annually you will almost always be in a position to receive the full charitable tax credit (unless you give a very large amount).

You will also have significant flexibility in terms of how much to give, who to give to, and be able to change your mind any year you wish. The charity will also benefit today instead of having to wait for many years.

T2820027_saking out a life insurance policy is not as common, but is actually one of the best ways to leave a charitable legacy. Using an insurance policy with the charity as a beneficiary can be a quadruple benefit if you qualify. The first benefit is that if it is structured properly, the annual insurance premiums can be considered annual charitable giving, so that you get the tax benefit each year.

The second benefit is that the insurance policy bypasses the estate, and is paid directly to the charity. This avoids estate battles over the funds.

The third benefit is that the proceeds avoid probate because they don’t form part of the estate. In Ontario, this 1.5% fee can add up on a major charitable gift.

The fourth benefit is if you are in reasonable health for your age (even if you are 75 or 80 years old), the ‘rate of return’ on the insurance can be much higher than other options. This is because the money is tax sheltered and as a permanent life insurance policy, the actual rate of return (money put in vs. money that comes out) is often well over 7% per year.

There are several other good ways to leave funds to charities including community foundations, setting up a private foundation and donor advised funds. Every one of these options requires some personal planning to determine what makes the most sense for your situation.

In the case of the 85-year-old, by giving $30,000 a year to charity they are receiving the full tax credit every year. If he lives to age 97, he should still have an estate of about $200,000. If he is still alive at 97, he can stop giving to charity in order to ensure he has funds to cover another ten years. In his case, if we assume he lives to age 97, he will have given an extra $100,000 to the charities than if he simply left the money in his will, and he will have been able to see the impact of his giving in his lifetime.

Leaving significant money to charity can be of great value to you, the charity and society at large. However, if the plan is to simply leave it through your will, there are likely many other smarter ways to make a bigger impact with the same funds.

Written by Ted Rechtshaffen, President & CEO of TriDelta Financial.
Reproduced from the National Post newspaper article  23rd March 2013.