Why Should Seniors Have a Personal Care Contract?

 Many children are willing to voluntarily care for a parent or loved one without any promise of compensation. But the person providing care for a loved one usually makes significant sacrifices. For example, giving up a job and employment benefits. A formal agreement among family members can provide a way to compensate a person providing care if he or she is no longer able to hold other employment. Even though most family members want to help and feel a sense of duty to care for a loved one, caring for an elder parent is a job with heavy time commitments and responsibilities. That’s why, a growing number of families are entering into Personal Care Contracts. Having such a contract holds big benefits. First, it rewards the family member doing the work, while alleviating tension between family members by making sure that work is fairly compensated. Second, it is often a key component to elder law planning and obtaining government benefits.
So, what exactly is a Personal Care Contract? It’ s an agreement between a senior parent who needs care and another person (who need not necessarily be the parent’s child). Personal Care Contracts should be carefully drafted to avoid the transfer of money being deemed a gift. Typically, that means the agreement is in writing prior to the delivery of personal care services, details out the services to be provided, at a rate for comparable services in the senior’s area, and is signed by both the senior and person agreeing to perform the services.
Besides lessening tension among family members and making sure that work is fairly compensated, it sometimes comes as a surprise to people that the VA generally allows veterans who served during a time of war – even if they didn’t serve in country – to deduct the annual cost of paying any person, such as family members or hired help for care when calculating VA Pension benefits. That means that families can sometimes receive extra income from the Veterans Administration, simply by creating a Personal Care Contract! This year, a married veteran can receive up to $2,120 per month, while a widow of a veteran can get up to $1,149/month.
Personal Care Contracts can also be extremely useful in obtaining Medi-Cal benefits. Actually, these contracts offer so many benefits, most families who have a child providing care for an elder parent should have one. To set up a Personal Care Contract for your family, contact Randall F. Kaiden, Esq., at Kaiden Elder Law Group, at 661-247-8433, or via our website: www.kaidenelderlaw.com.