Nursing homes. Two words that strike fear into the hearts, minds and pocketbooks of the elderly and loved ones alike. Historically, as parents and grandparents aged, it became customary to take care of them into their senior years. However, with our society becoming increasingly fast paced and families living further and further a part, nursing homes are not likely to go away any time soon.

In our state alone, there are over 351,000 Kansans over the age of 65 and with the baby boom generation inching closer to retirement age every year, the need for assistance into your senior years is becoming more essential than ever. With the average cost of nursing home care reaching $3,000 to $6,000 per month, paying for this needed care is becoming a problem.

However, there are some things that you can do now to help prepare for the future. At an annual hard cost of anywhere between $30,000 to $60,000 family members don't need to drain their saving and checking accounts to cover the cost of a loved ones care. But it takes some planning and with the help of the Kansas CPA Society we have put together a list to help families.

What to do when your parents need your help:

More and more baby boomers are becoming official members of the sandwich generation, the group of adult children squeezed between caring for aging parents and raising growing children. One of the many challenging responsibilities these adult children face is the task of handling their parents' financial and legal obligations.

Talking Money:

It is important to discuss the finances openly. This is hard to do for many adults because we don't enjoy discussing money, let alone with our parents. But if you wait until they succumb to illness or death then it may be too late. It is critical to have this discussion while your parents are still physically fit and mentally competent.

Tackling the paperwork:

With their permission, locate and review your parents' bank savings and checking accounts, investment and retirement plans, insurance policies, outstanding mortgages and loans, and any pension or Social Security payments they may be receiving. It's also a good idea to round up the names of their attorney, stockbroker, insurance agent, financial planner and accountant.

Handling finances:

When it becomes necessary for you to begin managing a parent's day-to-day finances, you might be inclined to set up a joint account. Before you do so, you should be aware that there are some drawbacks to this arrangement. For example, if either of you gets into financial trouble, creditors can take all the money held jointly, regardless of who owns the money. Also, since any money in a joint account with your parents becomes yours when your parent dies (regardless of directives in your parent's will), you run the risk of disgruntled siblings.

There are, however, some ways you can simplify your tasks. For one thing, you can save yourself extra trips to the bank by having your parent's Social Security, pension, and dividend check deposited directly to his or her bank account. You may be able to arrange to have the bank pay for your parent's regularly recurring bills, such as insurance premiums.

Putting legal documents in place:

Make sure your parent has a will and that it is up to date. If the estate is sizable, he or she might consider establishing trusts. In addition to saving on estate taxes, trusts can be designed to accomplish many different objectives.

Your parent also should have a durable power of attorney drawn up, a legal document that enables your parent (who must be mentally competent when the power is given) to give you or someone else the authority to sign checks, pay bills, and handle his or her financial affairs. Be certain that the power of attorney is durable, since only a durable power of attorney remains in effect if your parent becomes incapacitated.

Two other documents that can make your care giving task less complicated are a living will, which sets forth your parent's wishes about the use of heroic measurers to sustain life, and a healthcare proxy, allowing you or the person named in the document to make medical decisions on behalf of a parent. Legal requirements for powers of attorney, health care proxies and living wills vary from state to state. When executing legal documents, make sure you consult with an attorney in the state where your parents legally resides.

Hopefully, the information I have listed will help families planning for the future. Remember, it is never too early to begin talking to your family and getting your affairs in order. Nobody wants to be a financial burden and these are some affordable things that you can do to help protect them.