Monday, May 4, 2009

Find a way to talk finances with elderly parents

This week on Twitter, we're posting financial tips on how to handle finances concerning elderly parents @family_finances. We got a question from Matt_SF about how to start the conversation on finances. This is a terrific question, and I'm happy to answer it here. Twitter doesn't provide quite enough space. If you have thoughts on this, please share in the comments section.

One of the toughest conversations you'll ever have with your parents will likely be about finances. Most of us value our independence, and that's a real issue with aging parents. The taboo isn't money so much as it is death or disability. Those are the great big elephant in the room that no one wants to acknowledge! But he can't be ignored forever and - like it or not - children are left dealing with a crisis when it comes along. So, truthfully, it's in everybody's best interest to have this conversation.
The key issues, as I see it, are information and preferences. First, where can we find the things we'll need when something happens? Checkbook, bank accounts, insurance policies (health and life), and deeds to property or investments? These are things we'll need to take care of you. Also, your estate plans, trust documents, powers of attorney, or living will documents. If we are to help you, we need to know in advance what you have and what you want. Take notes, and put them in a safe place. You can't rely on memory in times of crisis.
If you just can't bring it up out of the blue and it doesn't seem critical, let something else raise the issue. When they mention a friend or relative who is sick or having trouble, ask what they'd want you to do in similar circumstances. Bring them an article or send them a link to this post. It doesn't have to be heavy or sad, just an acknowledgement that you need information to help them when the time comes. Hopefully, many years from now!

1 comment:

  1. Thanks for taking the time to answer Dan! I'm labeled as the conservative of the family, but since my parents are nearing retirement, I think it's a valid argument (quite literally) to bring up.

    My biggest fear is the current lack of transparency is due to a bigger reason... like their nest egg may have a few cracks and parental pride is getting in the way. Let's just hope this isn't the case, but at least we have a few more years to tackle the issue.

    Good idea on bringing up past relatives or family friends. I'll drop that hint this weekend and see where it goes.


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