With people living longer, many need periodic help or even ongoing care. According to a 2008 Gallup Poll, 41 percent of baby boomers who have a living parent say they provide them with financial help, personal care or both. That survey also found that 37 percent of those who are not currently helping a parent say they expect to do so in the future.

Pre-plan for your parents' needs
"When guiding my clients on how to help their elderly parents, I emphasize the importance of pre-planning," says Andrew Schappacher, a financial center manager with Fifth Third Bank. "First, it's very helpful for them to become knowledgeable about their parents' finances."

In some cases, it may be helpful for a family caregiver to be designated the parents' power of attorney for finances. This is an estate-planning document that grants an individual legal permission to act on another's behalf. "Being named power of attorney allows that person to write checks from the parents' bank account, pay their bills and sign documents on their behalf," Schappacher explains.

No matter who is designated power of attorney, it is very important for that individual to maintain the trust of other family members. "Open, ongoing communication is very important," Schappacher continues. "One way this person can maintain family members' trust is to keep them informed about all expenditures."

How to pay for parents' expenses
When possible, Schappacher says family caregivers should pay for the parents' expenses with the parents' money before they tap into their own. He recommends using the parents' non-taxable assets first, such as savings and checking accounts or CDs. Because of tax ramifications, he encourages families to seek guidance before withdrawing money from retirement accounts.

Consider long-term care insurance
In some cases, families may anticipate the need for an elderly parent to move into a care facility. "I encourage families to be proactive and learn all they can about long-term care insurance before it's needed. All too often, this type of insurance can be hard to get if you wait too long," Schappacher says.

Long-term care insurance typically covers the expenses of living in an extended-living facility or receiving in-home care. It also gives families peace of mind knowing that if something happens, their elderly parents can afford to go to a facility of their own choosing - and their entire nest egg may not be wiped out.

There are many types of long-term care insurance and some products can be tailored to meet to a client's specific needs. Schappacher encourages families to learn more about this type of risk management by visiting a bank or insurance provider.

In many families, a family member may quit working to care for aging parents. "If that's your preference and you can afford to do that, then go ahead," Schappacher says. "Sometimes these are personal decisions - and not financial. My sister quit working to care for our parents and found that to be a very rewarding experience."

To learn more about how to help aging parents manage expenses, contact Fifth Third at (866) 475-4201 or visit 53.com.

Fifth Third does not provide legal or tax advice. Please consult your legal or tax advisor before making any decisions or taking any action based on this information.