Budgeting for Elders

Budgeting is part of any effective Life Care Plan. It begins with an assessment of your resources and your needs. The purpose of Life Care Planning is to improve the quality of life for the person or persons for whom we are planning. Budgeting helps us understand what we have to work within in accomplishing that goal.

As you prepare your budget, there are several basic concepts you should consider. First, you should determine your needs. Is your monthly income sufficient to meet your needs and, if not, how will you supplement (or enhance) your income to meet your needs? You should aniticipate both regular expenses (e.g., housing and groceries) and extraordinary expenses (e.g., replacing a roof, large healthcare expenses and so on). Where possible, consider limiting certain risks by purchasing insurance. If you need professional help, speak with a Certified Financial Planner or someone else who has the skills to help you establish a budget.

Create a budget by:

• 1. Creating categories that describe your expenses.
• 2. Estimate expenditures for each category. Use last year's expenses as a guide.
• 3. Find areas where you can cut back.
• 4. Implement your budget
• 5. Review and modify your budget at regular intervals.

Budgeting Links:

• My Budget: Budgeting Tool (pdf file)
• Financial Planning Toolkit (CCH)
• Betterbudgeting.com
• Budgeting Tools (Kiplinger)
• Retirement Planning Tools (about.com)

© 2004, Law Office of David L. McGuffey, LLC

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