We love our family at all ages, but talking finances with the older members of the family can be tricky business. Seniors don't like to discuss their money situation, especially with their children. And that stems from the core of aging - there is already so much they need help with, and they want to retain some independence.
However, like any family, there is a time and a place for a little tough love. When it comes to helping your parents age gracefully into their older years ahead, finances can play a big role. Here are some tips on how to help your aging parents get their finances together.
First and foremost, keep things in perspective. Think about how you would feel if your children came up to you and started auditing your credit card statements with no apparent reason. That is how your parents can feel, not to mention it can make them experience guilt, anger, disconnectedness, and frustration. Your parents may view your intervention as rushing them into a home so that they are less of a burden on you and your life.
Be upfront about your intentions. You don't want to belittle your elderly parents, but you want them to make the right financial decisions for their wellbeing. Clarify your intentions so they can see that you are on their side and that you are all still a family unit.
Know Their Plans
Discuss with your parents their plans. Every family is different and unique; some elderly family members want to stay in their private home as long as possible, while others are open to living in a retirement or assisted living facility. Whatever your parents' wishes are, support them if it is reasonable to do so. If not, it may be time to have a discussion with them about what decision is in their best interest.
Whatever your parents' plans are, there are some areas that need to be discussed before proceeding. Some important questions to consider:
- Do you have power of attorney? If not, then who does?
- When was their will last updated?
- Where are their financial records?
- Do your parents have a financial advisor? If yes, can you contact them?
- What is their long-term care situation?
- What do your parents' pension and/or retirement earnings look like?
The plan may change a million times over, but it is good to be safe rather than sorry. Around 55% of the American population passes away without any will or estate plan. By knowing all of these answers ahead of time, you can save a lot of stress in the event of their passing in the future.
Understanding Medicare, Medicaid, and Health Insurance
Perhaps one of the most important aspects for senior family members regarding healthcare is what plan(s) they have. The American Cancer Society estimates that there are approximately 3,000 new cases of cancer in the United States every year, and your aging parents are not immune. If your parent is or becomes incapacitated, the pressure lands on you to find out what government assistance they qualify for and the documents you need to manage their accounts.
Also, it is important to understand your senior family members' existing healthcare coverage. Around 20% of adults do not think that the healthcare system was designed nor prepared to deal with the aging population. Finding out your parents' current plans, and those expenses can help you to get your aging parents' finances together.
It is important to talk to your aging parents about their finances and to help them get their documents in order. Remember to come from a place of love and empathy; they need to see that you are wanting to help and have their best interest in mind. Asking the tough questions and finding out all the nitty-gritty details can make everything smooth sailing for you and your parents.