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How to Prepare Your Finances with Parkinson’s Disease
You’ve received your diagnosis, and the tremors, stiffness, and slowing movement have a name. Parkinson’s disease (PD) disease is a progressive nervous system disorder that affects movement and occurs when neurons in the brain gradually break down or die, according to the Mayo Clinic. In addition to physical and psychological symptoms, Parkinson’s disease costs more than $25.4 billion every year in medical expenses and $26.5 billion in missed work, lost wages, early forced retirement, and family caregiver time, according to a study conducted by the Michael J. Fox Foundation.
A Parkinson’s diagnosis can completely change your income and expenses, so it’s important to have a plan — and above all, remember that living with PD into old age is quite possible. You may want to meet with a financial advisor, set a budget or financial plan, evaluate your retirement fund, and consider how Medicare can help.
“Updating a financial plan upon diagnosis is advantageous for two primary reasons. First, a comprehensive financial plan offers peace of mind for the newly diagnosed and their families as they face an uncertain journey,” says Brendan Willmann, a certified financial planner and enrolled agent with Granada Wealth Management in Asheville, North Carolina. “Second, because the disease is degenerative, it is advantageous to review finances and estate planning prior to a decline in cognitive functioning. Doing so can help ensure decisions are made while meeting the legal requirement of a ‘sound mind.’”
What to Expect with Parkinson’s
There are five stages of PD and the disease progresses at each stage. No matter which stage you’ve been diagnosed in, it’s a good idea to have your finances in order because you may find that the disease becomes increasingly difficult to manage.
You may have mild symptoms such as tremors on one side of the body as well as changes in posture, walking and facial expressions.
Tremors, rigidity and other movement symptoms affect both sides of your body. Walking problems and poor posture may cause daily tasks to be more difficult if you live alone.
Stage 3 is considered mid-stage. Balance, movement slowness and falls are more common. Your symptoms can hinder everyday activities such as dressing and eating.
Symptoms are severe at this stage. You may be able to stand without assistance, but movement may require a walker. You’ll need assistance with everyday tasks and will be unable to live alone.
This is the most advanced stage. Stiffness in the legs may make it impossible to stand or walk and you’ll require a wheelchair or must be confined to bed. Nursing care is needed full time and you may even experience hallucinations and delusions.
Develop a Financial Plan
It’s important to think through how these stages will impact you both physically and financially. Here are a few items to consider as you plan your overall financial goals, and if you’re a younger Parkinson’s patient, you’ll need to consider these in more detail, particularly if you’re not ready for retirement.
Ask your medical team to help you estimate the costs of medical expenses, including medication like Carbidopa/Levodopa, as well as physical, occupational and/or speech therapy. You may also want to ask whether you’ll need deep brain stimulation (DBS), which is an electrode that’s implanted into a targeted area of the brain to help with tremors and motor issues.
Assistive Technology and Equipment
You may need equipment that will help you with day-to-day lifestyle changes. Adaptive equipment may include:
- Compression hosiery
- Adaptive clothing to make it easier to get dressed
- Weighted utensils that can help stabilize eating movements
- U-Step walkers to increase mobility
- Transfer chairs and wheelchairs
Consider tapping into a health savings account (HSA) to pay for these types of expenses — an HSA is a tax-exempt savings account you can use to pay for certain medical expenses. Another option is to go to your local bank, credit union or online lender and look into a personal loan. Personal loans, which aren’t backed by collateral (you won’t lose your house or your car if you get one) can offer you a low interest rate for some of these necessities if you have good credit.
Potential Job Loss
You’ll need to plan for any potential job loss by rounding up disability insurance benefits, personal savings, retirement benefits (if you’re of retirement age), and more. Consider any supplemental income, like rental income, that will be able to help you bring in extra cash and which can bolster the money you bring in per month and in the event of a job loss. Open a savings account, money market account or any other low-risk account that will keep your money intact.
Long-Term Care Costs
Do you have a long-term care insurance policy? If so, now’s the time to review it. Long-term care insurance is also called nursing home insurance and can save your family a lot of money in the long run. Don’t have long-term care insurance? The median cost of long-term care out of pocket depends on your state but is about $85,800 on average in all states. It’s a good idea to work out how you’ll pay for long-term care insurance or what your options are if you don’t have this type of insurance.
Make a determination early on as to whether you prefer in-home care or assisted living. Parkinson’s patients tend to require more care than the average individual in assisted living (approximately $500 to $1,000 more per month than average). The national average for in-home care is approximately $4,500 per month, whereas the cost for assisted living is $4,250.
You may not have any choice but to dip into savings to pay for care. However, there are a few ways you can alleviate the full cost. Check with an accountant or tax attorney to learn more about tax credits for elderly dependent care, medical expenses tax deductions and elderly and disabled tax credits to help reduce these costs. You and/or your family members may also want to look into respite care — you may qualify for low- or no-cost care to offset in-home care costs
Estate Planning and Legal Fees
There are a few legal fees you’ll need to plan for, particularly when you do some estate planning. Estate planning documents take care of your decisions while you’re alive but if you’re incapacitated and can no longer make decisions on your own. In other words, you can decide in the early stages of Parkinson’s how you want your assets and care handled — through a will or trust, durable power of attorney, guardianship and/or an advance directive.
Margaret “Pegi” S. Price, J.D., professor at National University and the author of the book, The Special Needs Child and Divorce: A Practical Guide to Evaluating and Handling Cases, says the average cost for estate planning and legal fees are:
- Attorney fees: A few hundred dollars per hour
- Court fees: $200-300 range
“In the later stages, a person with Parkinson’s disease can experience cognitive decline, including dementia. It is vital to set up all legal documents, like a will or trust, power of attorney, and advance directive early in the process, while the individual still has the legal capacity to sign legal documents. If you wait too long, the family might have to file a guardianship action with the courts,” Price says.
Wills and Trusts
There are differences between a will and a trust. A will is a legal document that appoints a guardian to your minor children and also explains what to do with your assets upon your death. If you don’t have a will, the state will decide how to distribute your assets to your beneficiaries. This process is called probate.
A trust is a fiduciary arrangement that allows a third party (trustee) to hold assets on behalf of your beneficiaries. Your beneficiaries will get access to your assets more quickly than they would with a will. A revocable living trust is called “revocable” because you can change it as your wishes change, and it’s called “living” because you make it while you’re alive.
Durable Power of Attorney and Guardianship
Eventually, the time will come when you need someone to make decisions for you. You’ll need to consider durable power of attorney and guardianship options early on. A durable power of attorney means that a trusted friend or relative will be able to handle legal, financial or medical decisions if you become incapacitated. The only way durable power of attorney is removed is if you revoke it.
Guardianship is awarded by the courts to someone who can look after your affairs when you become incapacitated. Guardians will look after your personal, financial and physical well-being. For guardianship, Price says the cost for a lawyer to meet with the alleged disabled person (to look at medical records, meet with the disabled person, find out that person’s wishes, meet the proposed guardian(s) and write a report) costs around $3,000 and approximately $250 per hour. Service fees (for the sheriff to personally serve the papers) is about $100-$200.
In addition, a medical, psychiatric, vocational expert, or some other expert on disabilities will be $500-600 an hour.
An advance health care directive is also known as a living will. An advance directive is used to make health care decisions once you’re unable to make them yourself. It could involve indicating whether you want a machine to continue breathing for you if you can no longer breathe on your own, do not resuscitate orders, and more.
You may want to consider setting up a savings account as soon as you are diagnosed to take care of some of these expenses, if you don’t already have an account you’ll draw from to pay for various costs. You may want to talk with your loved ones at length about these major financial decisions.
Organizations That Can Help
It’s important to assemble a team of professionals shortly after diagnosis. “A certified financial planner (CFP) should be able to assist in organizing finances, an important first step. A family meeting with a CFP, a qualified tax advisor and an estate planning attorney can serve to address family questions and prepare a fully coordinated, comprehensive plan,” says Willmann.
A qualified team should be able to answer any cash flow assumptions, go over life and disability insurance policies, as well as Social Security and Medicaid benefits. Professionals will go over your Medicaid eligibility and offer you a clear understanding of your options upon incapacitation.
Life and Disability Insurance
Your CFP should be able to go over any life and disability insurance options you can tap into. Life insurance is a lump-sum payment or death benefit paid to your beneficiaries when you die. Disability insurance is intended to help replace some of your income by paying you periodically when you become unable to work, according to the National Association of Health Underwriters (NAHU).
Social Security Benefits
There are two programs where you can reap Social Security benefits, and your team of professionals can help you choose when you should tap into one of these programs:
- The Social Security disability insurance program can offer benefits to you and certain family members if you worked and paid Social Security taxes.
- The Supplemental Security Income (SSI) program pays benefits to disabled adults and children who have limited income and resources.
Medicaid and Medicare Benefits
Medicaid is a joint federal and state program that provides free or low-cost health coverage to millions of Americans, including people with disabilities, according to Benefits.org. Answer a few questionsto see if you could be available for Medicaid assistance.
Medicare is a federal health insurance program that can offer you health benefits if you’re 65 or older. There are several parts you can look into:
- Part A: Covers inpatient care in hospitals, nursing facilities, hospice, and home health care.
- Part B: Covers services from doctors and other health care providers, outpatient care, preventive services, and more.
- Part C: Medicare Advantage: Covers everything that original MedicarePart A and Part B) covers, plus prescription drug coverage and other benefits as well.
- Part D: Helps cover the cost of prescription drugs.
- Medicare Supplement Insurance: Covers health care costs that the original Medicare program does not cover, and it’s sold by private insurance agencies.
There are numerous nonprofits that can offer resources to you and your family upon diagnosis. The Michael J. Fox Foundation offers Parkinson’s 360, a resource base that can address any questions you may have.
Veterans with Parkinson’s
The VA can also help finance health care and compensation if you were exposed to Agent Orange or other herbicides during military service. Agent Orange was used to clear plants or trees during the Vietnam War. You do not need to establish a connection between Parkinson’s and military service to receive free VA health care and disability compensation. Know your rights and what you’re financially entitled to by submitting a medical record that shows you have an Agent Orange-related illness and a military record that shows that you served in Vietnam during a particular period
Prepare for the Future
You may feel as if you’re preparing for an uncertain future, but one thing is for sure: it’s a good idea to begin saving and preparing so you can manage what the future holds. Whether you need an estate-planning attorney, financial advisor, assistance with Social Security, or even just help figuring out what to do with your savings, pinpoint your needs as soon as possible.