Being an only child has its perks, but there are also significant drawbacks. Specifically, you will mostly likely be your parent's caretaker when they fall ill or become unable to care for themselves. Although your parents may have made plans to ensure you're cared for after they pass away, it's equally important you take steps to ensure your parents' needs will be met if you die before they do. Here's are two thing you should do.
Include a Successor in Any Power of Attorney Document
A power of attorney is a document that gives a person the authority to act on another's behalf. For example, a healthcare power of attorney allows the named party to make medical decisions for a patient who is incapacitated in some way. This is a necessary document to have when caring for your parents, because it lets you bypass a lot of red tape so you can take care of issues that may come up.
However, these documents become useless if something happens to you, because no one else besides you will be able to handle your parent's health and financial needs if you're the only person named on the power of attorney. Therefore, it's a good idea to have your parents name either a successor or a joint attorney-in-fact who can step in and fill the void if you're unable to.
Since you're an only child, this may be your spouse, your child, or a friend of the family. Regardless of who it is, be sure it's someone both you and your parent's trust to do the right thing when the time comes for him or her take responsibility.
Place Assets in a Trust Fund
Another thing you'll want to do is place money and property designated for your parent's care into a trust fund. For instance, if your parents live with you and you want to give them to have your house after you die, place the home in a trust. Eligibility for many social programs available to older people are based on the amount of money and assets people have. Making your parents the beneficiary of money or valuable property may have a negative impact on their benefits (e.g. reduce their Social Security payments).
However, property and money placed in a trust are typically excluded from consideration, depending on the type of trust you form. Thus, you'll be able to ensure your parents have the resources needed to finance their care while also protecting their current means of support.
For more tips on creating an estate plan for yourself and your parents, contact an attorney, like one from Hurth Sisk & Blakemore LLP.
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