Conversations about money can be awkward, even more so when the discussion involves talking to your aging parents about their finances. Unfortunately, silence about money matters can be costly, both in terms of funds and in future challenges facilitating the adequate care and comfort of loved ones headed towards retirement and beyond. Here are some things to consider when talking to your parents about their finances.
Timing is Everything
With a talk this important, make sure you set aside a specific time to discuss everything, so no one is rushed or distracted. Decide who will participate ahead of time, including siblings and other respected family members as well as clergy, financial advisers or legal counsel. Set the tone at the beginning by choosing someone to start the conversation who is trusted and can put your parents at ease. Begin by setting out the goals and parameters in advance, so that everyone involved will know what to expect and can prepare accordingly. Finally, make sure to get everything in writing and distribute a summary afterwards to everyone involved. Communication is key at this early stage in the process, so make the extra effort to keep everyone on the same page.
It’s Not Just the Money
It can be challenging to get everyone in the same room at the same time, so when you schedule your initial get-together, take the opportunity to prepare all essential documents, including power of attorney, healthcare proxy, wills, insurance and debt records. If possible, make copies of critical materials, and make sure more than one person knows where all original paperwork is stored so it can be easily accessed in case of death or an emergency. Now’s the time to also broach the subject of ongoing assistance as well. Ask if your parents are currently managing their bills and other accounting tasks easily or if they need help. Employing an accountant or elder law attorney can allow concerned family members to trust some of the more complicated aspects of estate management to unbiased third parties.
Sharing is Caring
Throughout the entire process, it’s essential you keep your parents in the loop. Make sure they understand every step of the process. Many seniors resist this discussion precisely because they fear giving up control of their money and their life. With those concerns in mind, take the time to talk about how sharing this information will allow them to have a better idea about their budget, and give them peace of mind regarding how finances will be handled in the case of illness or incapacitation. Finally, explain how settling matters now will make it easier for the rest of the family to deal with possible future crises by establishing clear roles and strategies for handling any emergency that may occur.
Keep it Personal
Stories can be a fantastic way to begin a tough conversation. One way to get past an uncomfortable impasse and bypass emotional ambivalence is to make it personal by telling your own story. Maybe explain how an appointment with your own estate planner prompted some concerns or relate an anecdote about a friend or loved one who faced a similar situation. Share your personal concerns and worries and be as specific as possible about the complications or challenges you predict your family may face moving forward. Always allow your parents to express their own fears and anxieties and don’t dismiss any worries they relate.
One Step at a Time
Begin knowing you will not resolve every issue in one consultation. Talking about money with your aging parents will take time and resolve. Not only will new problems appear as your parents get older, but speaking about money can take some practice. Having an open dialog and ongoing conversations can make all the difference in making everyone feel comfortable talking about this. Ultimately, it’s the fear of the unknown that often dooms these dialogues before they even start. By being proactive, and making the extra effort to ease communication between everyone involved, can help your family overcome that initial reluctance and establish a plan that helps you, and your parents, feel comfortable and calm about what lies ahead.