Category Archives: Retirement Shock

Early Retirement Invisibility: The Getting Over Yourself Transition

Non-financial Aspects of retirement, Retirement Shock

I used to be a telecom lead engineer. Guess what? Nobody cares. It sounds like a punchline from a certain humorous television commercial about teaching young homeowners how not to become like their parents. The reality of dealing with early retirement invisibility isn’t so funny if we aren’t prepared. It’s a retirement mental hurdle that hits many of us if we haven’t successfully detached from our work identity. Something that’s in us deeper than we’ll ever know until we actually retire and exit our career. I started, or at least thought I started this detachment years before ditching the rat race. But I still went through some things. Getting through it is a crucial key to retirement success. 

Early Retirement Invisibility: The Getting Over Yourself Transition

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Avoiding Early Retirement Invisibility Madness 

It should be of no surprise that after decades of building ourselves into a successful career that mentally letting go would be hard. It doesn’t matter that we were ready and willing to chuck it all for the freedom of retirement.

Many people fail to counter their feelings of early retirement invisibility. Miserable in their retirement because they couldn’t get over their previous selves, tied to title and position from an accomplished career. It can cause a mental funk that leads to complaining about retirement life and how it was a big mistake. 

A recent conversation with someone going through this mindwarp reminded me of what I went through and what I needed to do to overcome my own form of retirement invisibility crisis. 

The mistake of holding on-

I didn’t think my social life was as tied to my work as much as it was until it all ended. I made the mistake of doubling down on this social limitation by trying to stay connected to people I thought were real friends from my career. 

It didn’t take long to realize that the majority of these work pals weren’t friends after all. They were work acquaintances. We shared a common bond tied to our careers. Now that I was gone, I offered no real benefit to them as they were still in the toil. 

I should have immediately let go of my past and except for rare occasions, immediately let go of them too. It was all a one way street from me with their contact only coming back toward me when they needed to know something about work. My false notion about these friendships caused a delay in my transition. The real effort should have been immediately looking forward and doubling my efforts to grow my social circle with people more aligned with my new life.

Foolishly trying to prove something-

After delaying my freedom by a year I retired at the age of 51. It happened at the end of 2009 during the great recession. Nearly everyone thought I was crazy, foolish, or at the very least destined to fail. I didn’t have to prove anything to anyone but still ended up feeling the need to. Why? This was the exact moment I knew I wasn’t over my previous self. I gave up being a success in my field and had left with full confidence in my retirement decision. All the career accomplishment recognition had ended and now I was invisible trying to be seen in some way. It was dumb. 

Then truth-to-self hit me. I reminded myself that I voluntarily decided to no longer be an engineer changing that piece of the world. What others thought about my early retirement decision didn’t matter then and still didn’t matter now. The only thing I needed to do was put in some effort and move on. My proof was simply being happy and successful without the past. Achieving retirement success in the way defined by me. 

The allure of staying relevant to the working world-

One would think that after working through this retirement invisibility thing that it wouldn’t happen again. Wrong! I did take on some retirement gigs. It is all too easy to fall back into career identity even when you know it’s going to be short lived. It’s a menatly comfortable habit to identify with what provides us income. People are conditioned to consider what we do for money as the most important and interesting measurement in this go-go working world. 

For me, identifying with my retirement gigs was just a lazy way to answer other people’s questions. An easily understandable label. It eventually annoyed me and I immediately put a stop to it. It was a lot easier to shake my retirement work identity than it was the first time. I just changed my focus to why I was doing these paid roles in retirement instead of the roles I was playing. It served two purposes. 

1- It made clear my paid retirement work wasn’t allowed to bring anyone some twisted joy of perceived retirement failure on my part or reflect negatively on early retirement in general. 

2-  More importantly, doing this opened up a conversation towards sharing my retirement philosophy. A subject of great personal interest and passion: It’s the absence of needing to work that defines retirement, not the absence of working.  

Being Interesting Instead Of An Invisible Retiree Starts In Our Own Head

The new you is really better off.

It starts with understanding that the past accomplishments made us who we are today. Both the good and the bad. Maybe it was interesting, maybe it wasn’t as interesting as we think it was. What matters in retirement is embracing our future. If we think we’re invisible and boring then so will everyone else. 

Early in my retirement I found a lot of what I was passionate about wasn’t as interesting to others who were within my orbit. So what? It’s the spark in me that mattered, not their approval. I had escaped the merry-go-round of the working world and the problem was with them, not me. 

Just as our social circle primarily revolved around our career in our previous life, our new social universe will and should attract those with similar passions in our new retirement life’s direction. As we evolve, so will the group we gravitate toward to share our time with. It requires allowing the transition time to work it all out and putting in the effort to grow it the way we want it.

What and who do I want to be?

Of course nothing will happen to drop our tightly held work identity if we haven’t figured out what’s next for us. I had all this planned out before retiring, that I would never say I’m a retired engineer. I thought my numerous hobbies and pleasurable routines would be enough to fully detach. But I didn’t do the deep dive that I should have. 

I wanted to be free of unrewarding obligation. But I failed to recognize that a lot of that obligation, which benefited many others while giving me only headaches, also fed my ego. Ego has a hard time getting over itself. I really didn’t like that part of me so I had to actively kill it. Maybe that’s why I call myself a Leisure Freak. I’m sure most egos would hate that title.

Understand that pleasure is a poor substitute for fulfillment and  purpose.

Sure, pleasure will keep you busy and is a lot of fun. There’s nothing like smiling your day away, but it’s fleeting. It takes purpose for us to have the long lasting feeling of fulfillment, accomplishment, and relevance. Without any of that it’s far too easy to dwell on how it’s missing and how it was fed by title and earned income in our previous career life.

My solution was to be clear about what I wanted in retirement to provide me with a sense of something more than just unstructured freedom and memories of my previous, now meaningless past working world accomplishments.

Create- Always be making something. 

Whether it’s planning new projects and setting goals, or actually building something new. Always look for opportunities to create something new or build upon what is already there. From relationships to something physical, including anything in between.

Love- When doing what matters, be all in.

I focused on family and friends. Targeting the ways I could make our lives and our relationships better. I now had the time and in some ways more resources to try to bring a little more happiness to all of us. I also made certain that if I didn’t love what I was doing or the reason I was doing it for, it needed to change or end. It requires a sustained level of passion or interest to spend my valuable time on. 

Educate- Constantly feed curiosity by learning and also sharing what you know.

This happens to be my favorite retirement passtime. I focus on a subject of interest and won’t let go until I have learned all that I can, want to, or need to learn to fully understand it. The other side of this is to enjoy sharing what I’ve learned with someone else who has the same inquisitive interest. 

Appreciate- Recognize my blessings and good fortune.

I used to get ticked off when I was told I was lucky to retire early. Really! Do you know how much work it takes to retire young? I learned to accept that yes, I’m lucky and blessed. Someone like me wasn’t supposed to beat the system. Growing up low income with no connections, sponsors, or mentors usually leads to a different outcome. I was fortunate and lucky to want to learn the benefits of personal finance and the power it provides. I appreciate the unique place I’m in and vow to never take it for granted. 

Relax- It’s alright to take me-time, I’ve earned it without needing approval from anyone.

Back in the early “I’ve got something to prove stage” of my retirement transition that came shortly after my retirement celebration period ended, I felt like I had to be constantly progressing or doing something remarkable. And I wasn’t nor have ever been into social media. I can’t imagine what that must be like for those poor souls. Once I figured that nag out, I could just relax into the retirement pleasure zone. It is an important learned retirement skill to counter the decades of rat race objectives and achievement conditioning.

When it comes to retirement, none of us has a clue right out of the gate.

I picked up retirement advice and warnings from people who haven’t retired and from those who had. We talked about this overlooked aspect of retirement. I thought “duh”, I have it handled. If you are in this same mindset then all I can say is once the retirement celebration is over, prepare to get over yourself. You don’t know diddly-squat. There will always be at least a little something about your new retirement invisibility nagging at you. 

Those who don’t have to deal with retirement invisibility will be well ahead in their retirement transition with more mental bandwidth to work through the other things. Like say, going from saver to spender, is moving somewhere else in the cards, is the portfolio living up to expectations, how do I structure my day, etc. It all has to be done and is all totally worth the effort to create the perfect retirement.

The Common Post-Retirement Risk That Bit Me, Medical Scare  

Health, Protect Assets, Retirement Shock, ,

When planning our retirement we have to consider many financial and non-financial aspects. But retirement planning must be flexible because there are a lot of unknowns when it comes to the future. Knowing that and experiencing it are two different things. A lesson I learned when recently bitten by a common post-retirement risk, having a major medical scare. Ten years into early retirement and now my plan and the way I think about retirement may go through major changes. 

The Common Post-Retirement Risk That Bit Me, Medical Scare  

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Medical Scare – Probably The Most Common Post-Retirement Risk

There are a few post-retirement risks that we can encounter. Unlike inflation or a recession that can impact our retirement finances, a health threat can dig deep into finances, lifestyle, and sometimes even our life expectancy. Although we do our best to avoid long-term harm from any post-retirement risk, sometimes our best isn’t enough. Especially a sudden and serious medical scare that can hit anyone at anytime. 

This is a cautionary tale about how little things can get overlooked and written off when something silently lurks but needs immediate attention before it’s too late. Something we should avoid for both financial and non-financial aspects of retirement. Sometimes a sequence of seemingly random little things are interconnected, turning into something large and dangerous to our lives and plans.

Making Health A Retirement Priority

I have made my health a priority in my early retirement. I hike, bike, weight train 3 days a week, and do cardio workouts on an elliptical 5 days a week. Basically with everything else I do I’m pretty active. I have never smoked, have my medical physical every year, bi-annual dental cleaning, and take my prescribed medications along with several vitamins and supplements. Moderation is used for alcohol, red meat, fatty foods, and sweets. Even so, I recognize now there are areas of improvement needed.

A Minor Injury, Just Like Hundreds Of Times Before 

It was more of an inconvenience or annoyance than an injury. While working on my car I slightly strained my knee by hyper-extending it. It was sore for a couple of days like any similar injury we casually write-off in life. The only thing remarkable about it was that my leg also felt tight. It eventually felt better other than a slight pain in my calf. It didn’t slow me down and it too passed after a couple of weeks. I was over it and never gave it another thought.

Ten Weeks Later Something Else Odd and Discounted

My wife and I were talking and walking through our Art Festival when I had to stop to catch my breath. It lasted all but 5 or 10 seconds and then everything was fine. The next day another few second episode while exercising on the elliptical. Odd, but I still just powered through it and went on with life. A few days later I wake up to that same leg injured many weeks before being swollen with pounding pain. I called my doctor’s office and it was recommended that I immediately visit the emergency room. 

Big Bad DVT and Right Lung PE

Once in the ER, blood work, ultrasound, and CT scan eventually found I was lucky to be walking the earth. My right lung was plugged up with clots from top to bottom and basically offline. I was living on one lung at 6,200 feet elevation’s oxygen levels. Fortunately my left lung was clot spared and up to the task. All of this because I hyper-extended my knee causing a bleed and clot many weeks before. Something I would have never considered happening to me.

Treatment and Surgery

Life has since revolved around heavy doses of blood thinner that included 25 days of miserable stomach injections every 12 hours. There was also a two day surgical procedure to clear the large clot in my leg and spending three days in the ICU. My retirement life at this time still revolves around blood thinner medication, compression socks, and avoiding any chance of getting scratched, cut, or bumping my head. The long-term treatment verdict is still out for a few months. There’s a 50/50 chance I will be on one of those expensive blood thinners for life. 

Will My Medical Scare Change My Retirement?

It certainly has opened my eyes to my mortality. I have had a lot to think about while taking it easy as directed to me the past 3 months. I was cursed in one way and blessed in many others. Cursed because the clot didn’t present itself as a clot for so long. Blessed because when it finally did I still had a chance. I also felt blessed to be retired and have the time to concentrate on recovery. 

Things will and have changed in my retirement lifestyle and potentially even some financial aspects 

At this time long-term treatment decisions are still months away as we await evaluation of my healing. If it’s determined that I need to stay on one of those new safer and effective blood thinners for life then my retirement budget will need to be addressed. It will need to cover a new expense of over $400 a month until deductibles are met for the medication once the manufacturer $10 co-pay coupon I got expires.  

I will also have to rethink some of my lifestyle activities if on the medication. I have taken many minor bumps and falls while mountain biking. That could cause serious problems if on blood thinning medication. Possibly limit biking to my slow lane beach cruiser bike. All the things I do that I have found it impossible to never bruise myself or bleed because of a cut or scrape to my hands or arms will have to be rethought. Including working on my car, major landscape, and house maintenance or improvements. That will bring another adjustment to my budget to cover paying for work done that I used to do myself. Much earlier than my previous old age budget plan.

Things that will definitely change –

More than ever I see that we kid ourselves into thinking we can control everything. Life is finite, my retirement freedom is valuable, and I want it to last with quality as long as possible. It was a real bummer when this all happened. There’s a slight feeling of loss because I really loved the early retirement lifestyle I’ve created. But having to make changes and even sacrifices is part of countering any post-retirement risk that we encounter. I think I have moved past lamenting any loss, kicking myself for ignoring little things that grew into a giant threat, and I’m now looking toward my future. 

I’m not as tough as I used to think I was 

When something doesn’t feel right I can’t just power through it. I’ll need to change the way I approach my health and do a lot better about seeing my Doctor. I shouldn’t ignore any kind of lingering pain or odd events like a quick bout of shortness of breath.

I will definitely limit time sitting or standing still for too long. 

I’ve always limited extended sitting because of back pain. But now I will get up even more. Standing still waiting in long lines will also end. I also have a new appreciation for limiting anything that I don’t want around me or don’t want to waste time with. The top of the list are rude, pushy, and bullying people. I also have an even lower tolerance towards traffic, unwanted obligation, and manipulation. Life is too short to put up with crap.

Other lifestyle and health change on tap that have been put off or half-assed

I am really motivated to hit my long made weight loss goals. I hope this will also reduce the chances of a repeat DVT. Since this all started I am 40% towards my overall goal. Without exercise it’s all been about portion control and food choices. Once I can start doing more physically I should be able to hit my target. 

I’ll also pay better attention to my hydration. Something that slips past me when I am busy or playing hard. I think I will find many other little adjustments that will add up to big health benefits. 

It’s Easier To Miss Signs Of A Post-Retirement Risk Than We Think

Mixed signals and overlooked or discounted negative events can lead us to miss threats to our retirement and life. Occasional budget overruns, a poor investment return, cloudy economic signs, and issues associated with our health can sneak up on us. 

Optimism and confidence are welcome attributes but not when we let it blind us. I can’t help but remember how we all took a big hit with the market collapse in 2008-2009 and the recession. That is how it felt when the post-retirement risk of a health crisis hit me. There were mixed signals and overconfidence that had me power through it on my own when I should have had professional assistance to possibly catch what was coming my way. 

It’s a reminder that even with the best of plans and proactive retirement sustainability countermeasures, things can happen and throw everything into question. There are no guarantees, so we should do everything we can to enjoy what we have and to keep it.

My Retirement Spending Problem, How I Beat It

Early Retirement Lifestyle, Funding Retirement, Non-financial Aspects of retirement, Retirement Shock, , ,

Simply put, I had a retirement spending problem. I planned and saved for years so I could retire to the life I fantasized about. There were years of researching everything I could find about early retirement and personal finance, yet I still fought a retirement spending demon. It didn’t happen on day-one of retirement. Everything went exactly as planned. I ditched the rat race and celebrated sensibly for a few weeks while I settled in. But then my retirement spending troubles began. I had a big problem all right, I was psychologically attached to my retirement funds and it messed with my head.

We spend a huge chunk of our life saving for retirement and then, BAMO! We get hit with the reality that we have no idea how to mentally handle spending our hard-earned savings. I believe it was the hardest part of my retirement transition.

Retirement Spending Problem

Coming to Grips With Retirement Spending

The numbers were all there. I knew exactly what my lifestyle budget was and how much I would need to fund it. The portfolio was set up to make those funds available and yet I was miserable with concern, anxiety, and a lot of other emotions. All of which wasn’t in my very detailed early retirement plans.

What was in my retirement plan was using what was considered an acceptable safe withdrawal rate. That is always part of our retirement funding calculations. The fear of overspending in retirement and exhausting the portfolio before you leave the planet is well deserved. That’s why we de-risk our portfolios with diversified investments and make contingency plans for rotten economic scenarios.

As for my planned early retirement lifestyle, I had tossed aside any desires for extravagant spending decades earlier and embraced frugal living to get me to where I was. I had already created the perfect lifestyle. But even with everything planned for, I couldn’t shake the retirement spending nag. Going from retirement saver to retired spender was a mind warp!

I Reacted and Succumbed to the Spending Nag

I started to restrict everything I had planned on doing in my retirement that had a cost to it. My mind rationalized it as financially necessary and I didn’t think much more about it except for one problem, I still had memory of what I wanted in my retirement. It didn’t take long before I started to hate how this spending nag turned my retirement into a cheapskate lifestyle. I was always smart frugal, not cheap like this. What I was doing wasn’t anywhere close to the early retirement dream I worked so hard for.

I started to think about elderly relatives who lived through the great depression and how decades later they lived a miserly life even though they had a good amount of money stashed away. All of a sudden it all made sense to me. What I was experiencing was a different flavor of the same psychology. Only then was I able to self-assess my irrational retirement spending problem and turn it around.

Shifting The Way I Visualized My Retirement Spending

Let Go

Letting go of our title and work identity is a common subject talked about for retirement preparation. When I retired in late 2009 I don’t recall ever seeing anything about letting go of being a money saver. If I did I must have ignored it as a non-issue. Believe me, we do have to let go of being a saver. Even in months when my gains, dividends, and interest outpaced my withdrawals, I still could feel the spending nag of knowing those gains didn’t get reinvested like in the past.

Instead of letting this nag continue to rule me I decided to treat it the same way I did shedding my work identity. I recognized it as normal and part of my transition from worker bee to retired freedom seeker. I made a goal to stop letting this mental attachment to saving and growing my portfolio dictate my actions. Instead of letting it control me I now would control it. I made the mental decision to turn my unholy attachment to my saver mentality into something I needed to work through and let go of it.

Retirement Money’s Purpose

One of the things I had to remind myself about is that my portfolio was specifically created for one single purpose. It’s only purpose was to fund my retirement so let it. It wasn’t created to sit locked up and unused or worshipped like I was Gollum and his precious ring.   

Drop Emotion, Stick-To And Believe The Facts  

The numbers were sound and there was no logical need to restrict my planned retirement. They were double and triple checked using all kinds of scenarios to leave no logical doubt. There was no reason to have the retirement spending problem that I had. I simply recognized I needed to control my emotions and stick to the plan. Do that and everything would be fine.

Giving Time To Adjust

It took many years of smart frugal living and saving a big chunk of my income to get to where I was. It stands to reason that it would take time to adjust my mindset. I had years of conditioning my brain to successfully create a lifestyle I loved and pull off early retirement. No matter how much I planned what I wanted to do in my retirement and how I would fund it, it will take time to adjust my brain to this new way of living.

It Worked!!

It took a few months to fully relax into my retirement spending plan and I was cognizant of the nag for over a year as it occasionally surfaced. I look back now and I’m grateful that I took positive steps to recognize and counter the saver mentality that was over-controlling me. I know people who never escape it and live an unnecessarily restricted retirement.

Breaking free starts with having a smart budget that includes what we want to do in our retirement. A budget that then matches up to a sound withdrawal strategy. Then believing in the numbers, letting go of our saver’s mentality, and letting our retirement portfolio serve its purpose. Most of all, give ourselves time to settle into the new way of living and allow the numbers and planning to prove once and for all to our brain that everything is working exactly as it should.

Our spending discipline that gets us to early retirement won’t just disappear. If the worst should happen then we will logically do what’s financially necessary. In the meantime, purposely spend on the things that matter in retirement just as planned for.

Broke Family Member’s Long Term Care Can Be Your Retirement Shock

Long Term Care, Retirement Shock

Saving for a decent retirement is tough enough. Financially planning for our old age adds a lot of overhead to the numbers. But did you know that in some cases a family member’s long term care can become your retirement shock?

There are many people who couldn’t or wouldn’t save for retirement. Some of them may even be a family member or two. Many people have no plan for their old age nor any needed long term care. The issue of extended family’s long term care becoming our legal financial obligation just came to light for us.

We are now navigating the tricky issues around the sudden need for long term care for a parent. I thought it important to share what we have discovered.

First some numbers: According to what was found in the 2016 Genworth study, the national median nursing home cost for a semi-private room is $6,844 a month. 

Our situation: Where our parent lives the nursing home care happens to be $5,000 a month. She has $3,500 a month in Social Security and Pension income. That leaves a $1,500 a month shortfall that has to be paid from her other assets. Once all her assets are exhausted then State Medicaid can be applied for.

That is when things can become your own retirement shock to deal with. Fortunately our parent isn’t broke. Not yet anyway. Medicaid or our financial assistance won’t be needed or involved for a little while.

Filial Responsibility Laws Might Cause Your Retirement Shock

At issue is what’s called Filial Responsibility. The State can try to recover amounts paid out for long term care from family members. There was even a recent case in Pennsylvania where the courts backed a private nursing home. They singled out and sued one child for $93K under the state’s Filial Responsibility laws for his mother’s care. Medicaid had been applied for but not yet granted before his mother left. 

There are 29 US States and the territory of Puerto Rico that have these Filial Responsibility Laws. Our parent happens to live in one.

The following States have their specific flavor of Filial Responsibility laws on their books:

Alaska, Arkansas, California, Connecticut, Delaware, Georgia, Indiana, Iowa, Kentucky, Louisiana, Maryland, Massachusetts, Mississippi, Montana, Nevada, New Hampshire, New Jersey, North Carolina, North Dakota, Ohio, Oregon, Pennsylvania, Rhode Island, South Dakota, Tennessee, Utah, Vermont, Virginia and West Virginia, and in the territory of Puerto Rico

Filial Responsibility isn’t limited to one’s parents either. The State laws where our extended family members reside applies to siblings too.

That was a surprise to me and nothing I planned for. It’s one thing to try to help out a parent. But extending that financial responsibility to siblings goes far beyond anything I considered in my retirement planning.

I happen to have one financially reckless sibling who also lives an unhealthy lifestyle. I am not thrilled to know that my sibling’s life choices could turn into my retirement shock down the road.

The State Filial Responsibility Law Where our Extended Family Resides Says the Following:

“Children shall first be called upon to support their parents, if they are of sufficient ability; if there are none of sufficient ability, the parents of such poor person shall be next called upon; if there are neither parents nor children, the brothers and sisters shall next be called upon; and if there are neither brothers nor sisters, the grandchildren of such poor person shall next be called upon, and then the grandparents.”

Some State’s filial responsibility laws can also impose both criminal and civil penalties for failing to support their parents.

Broke Family Member now your Retirement ShockThe takeaway from all of this is that these laws allow nursing homes, hospitals, governments and certain third parties the ability to file a lawsuit against family members. They have legal backing to go after a judgment. One that obligates a family member(s) to pay their parent’s, sibling’s, or grandparent’s bill.

In the above mentioned Pennsylvania case. The nursing home didn’t even have to bother including all children in their lawsuit.

The Good News and Bad News Regarding Filial Responsibility Enforcement

The Good News- The filial responsibility laws have thus far been rarely enforced by the States. From what I read it’s because it is very expensive to track down and begin a suit against relatives of a broke Medicaid recipient. Not only that but judicial systems are already overburdened and filial enforcement would add to that burden.

States with these laws don’t even agree with each other over aspects of the laws. For example in the area of “sufficient ability” to pay. Nor have they figured out how to go after family members who live in a different State that does not have filial responsibility laws on their books.

The Bad News- The times they are a changin. There seems to be an appetite in Washington to reduce federal Medicaid support to the States. State budgets are already strained. If federal cuts do occur or States develop huge budget shortfalls they may feel that they have no choice but to hunt down extended family members who haven’t stepped up to the plate for their filial responsibility qualified family members.   

Mitigating Filial Responsibility Risk: What To Do

I wish we had been more involved in our parent’s financial condition and future elder care issues. It is usually uncomfortable to bring this up with a parent. I know I have heard “none of your business” many times from my parents. Along with our love and concern for their care, with filial responsibility it is our business.

If luck prevails, the hope is always that an elderly parent or family member can stay functional and healthy enough to remain in their home with our help.  Arrangements can also be made to have them live with us or with a sibling.

My mother lives with my sister in an apartment built specifically for her in my sister’s home. My sister and mother find it is a mutually beneficial arrangement.  

However, luck doesn’t always prevail. There is always the risk of incapacitation.

My mother-in-law was functional at home with her children’s assistance. But a fall and subsequent stroke has ended that option and left as us all scrambling. Something like this happens out of the blue and then there is no going back.

Here is what we are working through. I hope my sharing this will help others realize that it has to be part of our own financial planning to avoid serious future retirement shock.

Look into your parent’s State Filial Responsibility Law

Look online and find out what is on the books. We all want to do what is best for our loved ones. Knowing this will both motivate us to get moving and use it as leverage to get cooperation from an elderly parent who prefers financial privacy.

We only found out about filial responsibility after the fact. It was a financial surprise during an already emotionally stressful time. We are lucky that our parent has the funds to cover the financial side for a while. It gives us some time to adjust our finances to prepare for when our assistance may be needed.

Go over all of their financial information

Siblings should decide who should act as the lead. That way it is done once and not by everyone concerned. Have your parent write down all account information and assets held. Home equity/mortgage information, beneficiary designations, signers on accounts, etc. This is something that should be done for spouses and may have already been completed. If so then make sure it is up to date.

We had done this last summer when she was considering moving into an assisted living center. She had concerns that the house was too much. But she wasn’t ready to make a huge move like that yet. At that time we were just figuring out if she could financially handle it. Although we looked at account signers, beneficiary designations, etc. in the event of need, we should have been more seriously considering long term care too. I wish we had insisted she make the move then. But we all live without knowledge of what is ahead. The whole hindsight thingy… Our thought was she will decide soon enough on her own.

Power Of Attorney (POA)

It is important to get a POA. This is necessary to cover any assets that may need to be sold if our parent becomes totally incapacitated.

We were told one was in place but it was confused with beneficiary designations or something else. We should have all communicated more clearly among the siblings instead of taking our elderly mother-in-law’s recollection. My mother-in-law’s home equity is a big percentage of her assets. However there is still a $100k mortgage. That means we have to somehow come up with a nursing home funding shortfall and her home mortgage/HOA/etc. All those payments will quickly deplete other accounts until we can sell the home. Getting a POA now will be a huge challenge. Working under a “Guardianship” condition is time-consuming and costly.

Consult with an experienced Estate Planning or Elder Law Attorney

Be sure to seek a lawyer in the State where your parent lives. Filial responsibility laws and processes can vary State by State. A little money spent ahead-of-need will save a lot of trouble later on. Get educated. Know what is needed to facilitate and handle all the difficult decisions and options once a health event incapacitates a loved one. Develop a strategy covering which assets to use first for long term care, how/when to sell any property, and Medicaid issues.

We missed doing this before it was needed and have now met with an elder law attorney after the fact. The first thing they needed was a list of all the assets. Fortunately we had that done. We now wait to get their advice on next steps. Fortunately one of my mother-in-law’s accounts has one of our siblings as a signer. Otherwise we would be handling all the current financial issues for house payments, utilities, HOA payments, nursing home, etc. ourselves until things can be worked out.

Last Words

We did a lot in our own retirement and old age planning to make sure we won’t be a burden to our children. We now have the retirement shock of knowing we may have to also include a plan to handle a parent’s or even a sibling’s long term care debt as our financial problem if things go wrong.

It is important to be ahead of need in these issues. The goal is to have a clear long term care support strategy in place. One that is ready to be used in the worst case scenario. That includes having all the necessary legal work done to gain access to assets in the case of incapacitation.

Even though filial responsibility law enforcement is not a high priority in most cases for States to pursue, it doesn’t mean they never will.

We should all care about our elderly loved ones to help provide for them. Caring for a parent’s long term care wasn’t a big highlight of our retirement planning. Now it will be.

Doing things right can avoid ever having to worry about filial responsibility laws telling us through the courts what we will be paying and causing us severe retirement shock. By having a plan it also makes sure we are optimizing all options in a strategic way to reduce overall cost and provide the best care.