Part of our tough money questions series
4 tips for talking to your aging parents about money
It can be tough to bring up the topic of money with your parents. You may worry it’s an invasion of privacy. Or that they’ll feel threatened or be concerned about losing their independence.
Ryan Pope, a Principal® financial advisor in Raleigh, North Carolina, has helped clients in similar situations. But it became more “real” when he was faced with the same challenge when his parents retired at age 64.
“It prompted conversations that were a little awkward at first, but necessary,” Pope says. “I feel like talking about their future really deepened our relationship because I know what their goals are and what’s scaring them.”
For example, his father was more concerned with the money side of retiring, while his mother’s concern was who will care for her if she becomes ill. (“She probably thinks her husband and two sons wouldn’t be the best nurses!” he says.)
He wrestled with the same worries as his clients. Is this the right time? Will they perceive this the right way? Will they think I’m meddling?
One golden rule can guide you: Set the right tone. Pope says let them know you have their best interests in mind, and your goal is to help and support them, not exert power.
Beyond that, here are four ways to approach the conversation with aging parents about their finances.
1. Get help from your siblings.
Think about who has the closest relationship with Mom or Dad. And have that person start the conversation privately. Bring in the others later to talk about the specifics of your parents’ situation.
2. Start with a broader topic, like their plans for retirement.
You could ask, Will you want to downsize? Or, What kind of care would you want if you become ill? It may get them talking more than if you just asked point-blank about their finances. And knowing more about their wishes will give you a better idea of how much money they may need.
3. Ask if you can take something off their plates so they have more time to do what they like to do.
Pope says you could start with things that aren’t money-related—like helping with grocery shopping, or finding a lawn mowing service. Then offer to help with income tax preparation. They may take you up on that! Because who really likes to do taxes? It will give you access to financial information that opens the door to keeping the conversation going.
“The more involved I got in helping them, the more involved they wanted me to be,” Pope says. “When Dad built a new barn, he called to ask what I knew about getting insurance for it. He wanted me to be more of a partner to help with that decision.”
4. Offer to find out if your parents qualify for financial help.
For example, maybe you can find ways to help them pay for prescriptions, health care, or even utilities. They’ll need to tell you their monthly income, how they spend their money, and what benefits they already receive. Mom and Dad may be more willing to share information if they know it could help them financially, especially if you take the lead and help them through the process.
Planning ahead can help make transitions in their lives easier, both financially and emotionally. That's why it's important to find an approach that fits you and your parents and start the conversation.
Ryan Pope, Principal National and Principal Life Financial Representative, Principal Securities Registered Representative and Financial Advisor.
The subject matter in this communication is educational only and provided with the understanding that Principal® is not rendering legal, accounting, investment advice or tax advice. You should consult with appropriate counsel or other advisors on all matters pertaining to legal, tax, investment or accounting obligations and requirements.
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