While the image of a happy family where everyone always gets along is pleasant, this simply doesn't represent reality for many people. Take the story of a brother and sister that I knew. As children, these two siblings had never really gotten along, and as adults they'd become estranged. Eventually, however, it became clear that they were going to have to come together to deal with the needs of their elderly mother, who had severe dementia and could no longer live independently. Unfortunately, each had different ideas about the kind of care she really needed.

The sister had found a family home where she thought her mom could live. It was a small place with just six beds. A couple ran the facility, and there were no nurses or other medical professionals on staff. The home only cost $1,000 a month, which was a big plus in the mind of the sister. However, when the brother came into town to deal with this issue, he had a different idea about what would be best for the mother. This visit was the first time he'd seen his mother in many years, but he realized right away that something was definitely not right. Even though he wasn't that involved in the family, he saw that his sister's idea wasn't the best. That's when he called me to set up a meeting with him and his sister to talk about how to care for their mother.

When I sat down with the two of them, it was obvious that they were very estranged. However, they were cordial and civil to each other and to me. The siblings told their mother's story, explaining that she had become very dependent and was having a lot of trouble remembering to do things on her own. In addition, she was a diabetic and needed a daily insulin injection. Of course, this family home the sister had found didn't have any medical staff, so it wasn't at all clear how the mother was going to get the care she needed if she moved there. In fact, when the brother went to visit the family home and asked how this situation would be handled, he got a very telling answer. The man who owned the home said, "Don't worry, she'll get her insulin every day." Wink, wink.

That response was a huge red flag. What the home's owner meant was that an untrained, unlicensed individual was going to be giving the mother her insulin injections. Obviously, that wasn't an acceptable situation. Unfortunately, the mother was at the point where she couldn't afford anything other than this basic level of care. The only other option was a nursing home, since that's what Medicaid would pay for. And that's exactly what the sister wanted to avoid. However, I explained to the brother and the sister that the nursing home was the preferable option, because their mother simply wouldn't be safe in the family home setting because of her medial issues.

Since then, the siblings' mom has passed away. She ended up living out the rest of her life in a nursing home, where she had very good care and actually improved from living on her own. She was eating better and getting her insulin on a regular basis, and there was always someone paying attention to her needs. In the end, the siblings made the right choice.

The dilemma this brother and sister faced isn't uncommon. Often, when adult children try to make housing arrangements for parents as they become disabled, they don't consider the right factors. They may not like the idea of a nursing home. They may think certain facilities are too expensive. There can be a temptation to go for the cheapest option possible. Well, just as there's a big difference between the cheapest hotel and the most expensive hotel, there's a huge variation in the level of care you get at a basic family home versus a nursing home. If your elderly parent needs medical care or supervision, a nursing home may be the best―and safest―option. And in this case, that's what the brother and sister hadn't seen right away―that their mother's medical needs outweighed some of their other concerns.

This was also a situation where the sibling's estrangement could have caused real problems for their mother. Fortunately, the brother and sister, despite their personal conflict, were able to sit down and come to an agreement, without having to resort to more formal mediation or litigation, and without the state needing to come in and appoint a guardian. This is a good story to keep in mind when you're making your own decisions about caring for an elderly parent, since it's an excellent example of the importance of dealing with disputes about care before they become big problems that end up causing harm to the very person you're trying to help.

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Often, when people get older, they do everything they can to hide the fact that they suffering from health problems or diminished mental capacity. Take the story of a man I knew and his elderly father.

The son was a lawyer. He worked as a litigator, and he didn't have any expertise in elder law or financial matters. Recently, his father had fallen in the home that he shared with his second wife, the son's stepmother. The father had sustained some fairly severe injuries and needed to be hospitalized. Because the second wife had no experience handling the finances, she asked the son to step in and figure out where the money was so she could pay the bills. The son quickly discovered that the father had purchased an annuity from an insurance salesman at a local bank. In fact, the father had tied up almost his entire net worth―about $2 million―in annuities.



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Recently, I attended a national convention for financial planners. At the conference, I attended a session on Alzheimer's disease led by a young financial planner. After the presentation ended, another financial planner in the audience stood up and asked a question. She explained that she had a client who had a caregiver. The caregiver lived in the client's home and appeared to be a relatively well-to-do woman―she had nice jewelry and clothes, and her hair and nails were always done.

One day, the financial planner mentioned to the caregiver that she was supposed to be paying taxes on the money she received for caring for the client. The caregiver, perhaps not surprisingly, objected to that. To be specific, the caregiver did not want the elderly woman to issue her a 1099 for her services because she didn't want to pay taxes on those earnings. However, according to the IRS, the elderly woman was required to issue the 1099. Nonetheless, the caregiver argued that she'd never paid these taxes before, so why should she start doing it now?



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We don't always know―or want to know―the truth about our parents. Take the story I heard recently about an elderly gentleman who had passed away. The man had worked for the state government for many years and had seen both the good and bad side of life. After his wife died, his son moved him into an assisted living facility. While this man was having difficulty living on his own, he didn't really want to move.

This gentleman, who was in his eighties, was a bit lonely in his new home, and as a result he became friends with several of his caregivers. Two of those caregivers―a housekeeper and a nurse's aide―ended up becoming "special friends," which his family didn't realize until after his death.



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In July, regulation of more than 4,000 registered investment advisors (RIAs) shifted from the Securities and Exchange Commission (SEC) to the individual state authorities. This change was required by the Dodd-Frank Wall Street Reform Act, which was signed into law in the summer of 2010.

This change in regulatory requirements is one of number of reforms included in the Dodd-Frank Act, including requirements for RIAs to provide "plain English" disclosures in their Form ADV. Investment advisors will be most affected by these changes, but consumers may also benefit, since a more effective regulatory structure could help protect their assets. In addition, providing clear information about advisors could help them make more informed investment choices.



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