helping aging parents with finances

Have you talked with your elderly parents about their financial situation yet? They may have initiated a conversation, or you may have, either way it can feel awkward. But it is helpful to ensure our parents’ well-being, safety from scammers, and comfort level both physically and emotionally.

Turning the Tables

We’re probably all tired of hearing about Covid; however, one of the things it has made very clear is that life can change in an instant. And aging creates a higher risk for many things, so how about a little role reversal: let’s think about how we can be helpful to our parents after all the years they were helpful to us when we were younger.

A Touchy Subject

One of the most common questions I get asked in my workshops when talking to people about estate planning and helping their elderly parents is “How do I even bring up the topic?” Finances, estate planning, and end-of-life wishes are difficult subjects for most families to talk about.

We want to be respectful but also helpful. And given the high incidence of fraud among family members, it is definitely understandable if someone is hesitant to discuss their personal finances and estate planning situation.

Best Interests

In the financial industry, we are especially vigilant about confidentiality and also serving as a double check on what is going on with seniors’ financial accounts. It can be helpful to have a non-family member who is a fiduciary to be involved as a gatekeeper as well as an advocate for all of the things that should be in place.

Identifying a Trusted Contact person has become an additional way to get permission from clients to identify someone to notify when there is a reasonable belief that there may be possible financial exploitation going on.

If you are listed as the personal representative or successor trustee of a parent’s estate and will be involved in acting as a power of attorney now or settling their affairs after they’re gone, it really behooves you to be sure you understand not only what they have in place but what their wishes are as well.

So, for all of those reasons, it is crucial to have a conversation with our parents to express our love, concern, and willingness to help for everyone’s benefit in the end.

Having “The Talk”

Before talking to a parent, it’s best to think about what aspect of estate planning the parent may be most open to discussing. Is it more appropriate to approach it from thinking about their health, or a financial perspective, getting records organized or just from a general overall estate planning standpoint?

It’s also a good idea to think about your parents’ preferred way to communicate. Does your parent prefer to dive right into a conversation or read about a topic first or hear about an experience you had or perhaps hear a story about someone you know?

Once you identify the sub-topic of the estate planning conversation that you feel will make for the best initial discussion, think about how you will approach the subject.

Initially, it can be helpful to throw out what I call a “floater” question. You may share with your parents an experience you had or something you read about or heard on the news or found interesting. Then you can mention how it made you curious about your parents’ opinion on that topic.

A Different Approach

Or, instead of a question, it may be helpful if you approach it by asking for advice. Maybe you personally are working on getting your records organized or updating your estate planning. You may find it helpful to complete a checklist, net worth worksheet, or bill paying grid and maybe use that exercise to start up a conversation with a parent.

You may ask for their advice on what you are working on. An upcoming surgery is another time to take advantage of the moment to bring up the subject of estate planning.

These Unpredictable Times

Or it would be very appropriate in today’s Covid world to make a comment that it has all really made you wonder what would happen if you, or a parent, ended up in the hospital.

Are all the bills paid automatically? Who is authorized to make medical and financial decisions (power of attorney documents)? How long has it been since a will/trust has been updated/drafted? Is there long-term care insurance in place in the event that care is needed for a prolonged period after the hospital?

No matter how you approach the subject, be sure you listen and be persistent if it didn’t go as deep as you wanted it, yet. Ask again or share a resource another time. Don’t give up, this is important for everyone.

Have you helped an aging parent with their finances? What suggestions do you have for others in the same situation? What do you think is the best way to broach the subject? Let’s have a discussion!