Do you have a parent or family member entering a nursing home? Are you yourself considering entering a nursing home? If it’s not resolved before entering a nursing home, it can be a source of stress for their family. When credit cards aren’t paid off, the debt accumulates and often grows due to interest. In addition to credit card debt, there are usually other types of outstanding debts such as mortgages, car loans, or medical bills that may have been incurred prior to entering the nursing home.
What Happens to Your Credit Card Debt When You’re in a Nursing Home?
Credit card debt still has to be paid, despite moving into a nursing home. If you have credit cards that are being used at a high interest rate, then you might be paying more for their credit card debt than what you are earning through retirement savings and social security benefits. If you’re relying on your family to help you deal with this debt, we recommend consulting with a certified debt specialist before signing over credit cards or adding anyone else as an authorized user.
Are My Children Responsible for My Credit Card Debt?
Your children may be responsible for your credit card debt if they are credit card cosigners. If credit card debt goes unpaid, it will continue to accumulate which could cause credit card debt to spiral out of control and put financial strain on your cosigners. This is why it is vital to address your credit card debt as soon as you enter into a nursing home or other long-term care facility. We recommend utilizing debt settlement services to get rid of your debt while paying less than what you owe.
While your children won’t be responsible for your debts if they are not cosigners, your debt can impact them if you are planning on leaving them anything in your estate as debts will likely be settled prior to any inheritance being paid out.
How Seniors Can Manage Their Debt
The main recommendation we have for seniors in dealing with your debt is to take an active role in tackling credit card debt. If you’re wanting to avoid leaving your family with the cost burden of your debt, it is up to you to take proactive steps in managing credit card debt.
Ways to Prepare for the Cost of Long-Term Care
In addition to paying off your current debts, it’s also smart to prepare for the additional costs of long-term care. Nursing facilities can be costly and planning ahead can help you avoid the additional debt that could be accumulated in this process.
A Few Tips For Children of Elderly Parents
Resolve Any Debt Before Entering a Nursing Home
It’s important to work to resolve any debt prior to your loved one entering a nursing home. If credit card debt is left unpaid, it will continue to accrue interest which can be costly for seniors who are reliant on a fixed income.
Listen to The Account Holder’s Needs
The transition into the nursing home for your loved one may not be the most convenient time to talk about credit card debt, but it is also something that you should not put off. It’s important to talk to them about what their needs are so you can start to prepare for credit card payments and other financial responsibilities.
Talk to Your Family
Bringing in other family members can be a good way to split credit card debt. This way, one person does not have the full responsibility of the debt. While dealing with your loved one’s debt might not be ideal, talking about credit card debt with your family can help alleviate the stress.
Get All Account Information
You want to make sure that everyone involved is on the same page when working to alleviate credit card debt. Get the account holder’s credit card statements and any other credit information they have so all family members can get a good handle on the credit situation.
Be Honest About the State of Their Finances
Finances are a difficult topic for any family. However, if you are working with your loved one to pay off credit card debt or other credit obligations, they might not be upfront about the state of their financial situation. Make sure that you and your family are all aware of what is going on so no one feels blindsided down the road. If you uncover an overwhelming amount of debt or more than you feel you can pay back, debt relief might be able to help resolve the credit card debt for less than is owed.
Can CreditAssociates Help?
If you’re looking to deal with your debt prior to entering a nursing home, CreditAssociates can help you! Our certified debt consultants can give you a FREE consultation to help you find the best way forward to get debt free. Click here or give us a call to get started: 1-800-983-6693.
Common Debt Questions:
How can I protect myself from debt relief scams?
When dealing with debt relief companies, it’s important to use a legitimate company because debt relief scams are a growing concern. One of the best ways to protect yourself from credit card debt relief scams is by verifying that they’re members of a certified organization like the American Fair Credit Council. Another good way to see if a company is legit is to read customer reviews.
How can I avoid getting into debt?
There are many different strategies that you can use to avoid getting into debt. One of the easiest ways is to avoid spending outside your means. While it may be tempting to live outside of your means with the use of a credit card, the long-term consequences of credit card debt can be serious. Read budgeting tips here.
Can I keep my credit cards if I am in a nursing home?
You can keep your credit cards if you’re in a nursing home, but it might be a good idea to simplify your financial accounts and rely on fewer credit cards or perhaps even just a standard bank account. Whatever credit cards you do keep should be attached to the account that is used most often.
How can I protect my assets from being taken away by creditors when I’m in a nursing home?
The best way to protect your assets from creditors while you’re in a nursing home is to deal with your debt prior to entering a nursing home. Having these things squared away will prevent creditors from taking advantage of your situation while you are unable to care for yourself.
What if a child starts paying some of their parent’s bills—are they obligated to continue paying?
If you start paying your parents’ bills, you are only obligated to continue paying if you are listed as a cosigner on the account. If there is no legal document stating that you are responsible for your parents’ credit card debt, then there is no obligation.
What happens to my parents’ debt when they die?
When your parents die, credit card debt will not transfer to you, but to their estate. This could impact any inheritance you receive as credit card debt could be paid off before other debts.
What is the average cost of being in a nursing home?
While the costs may vary based on where you live, the average for a private room in a nursing home is $8,821 per month. A shared room might be more affordable at a cost of $7,756 per month.