3 The talks will be available as soon as possible

To be honest: it can be embarrassing for adult children to talk about money with their parents. Especially if you haven’t done a lot of things before.

But avoid talking about money, especially as our parents age and their needs change, which may cause a series of financial problems.

These conversations are difficult-but they are also very important. Starting the conversation early—before the crisis breaks out—in a natural way can help your family plan for the financial future.

3 financial planning conversations with parents

It’s not all about money. Adult children may want to discuss many issues with their parents, including long-term care, housing, and dividing assets and responsibilities.

Consider when, where, and who you want to participate in these meetings. Depending on your relationship, you may want to arrange a specific time to discuss money with your mom or dad.

Or it may be easier to bring up the topic casually in a stress-free environment, such as when you and your mother are clearing the plates after Thanksgiving dinner.

When you talk, consider starting a one-on-one conversation. The involvement of other family members or spouses may make the situation tense or completely derail the conversation.

“Every family’s dynamics are different,” said Marcy Keckler, vice president of financial consulting strategy. American Finance“But in general, if parents only talk to their children, then the family dynamics may be a bit simpler.”

1. What is your financial situation?

Your parents may be very good at managing their money. Or maybe they used to be, but now, you are not so sure.

As parents get older, they may find it difficult to control their personal finances. The bill may be ignored. Taxes may not be paid on time. Simple forgetfulness can cause serious financial problems, and our cognitive abilities will naturally decline with age.

The elderly may also be more vulnerable to fraud and scams. The number of bad actors targeting the elderly is larger, and the elderly are more likely to be recruited.

This can cause serious damage to your parents’ finances-and you may not realize what is happening until it is too late.

You don’t need to know the exact dollar amount from the start to start a meaningful conversation.

For example, you can ask your mom or dad to give you access to their online accounts-just to watch out for unusual credit card charges or to help simplify monthly bill payments by keeping all their accounts online and registering for autopay.

Later, if you need to manage their finances more personally, the transition will feel easier and more natural.

If your parents are still healthy and capable, encourage them to create a file or notebook to record their basic financial information, including their bank account numbers, the location of any safe deposit boxes, investment account passwords, their accountant phone numbers, and credit card details.

If they seem reluctant, let them know that you are from a genuine place and only want to help in an emergency. If they go to the hospital, who will ensure that the bill is paid on time?

If your parents’ mental capacity is gradually weakened due to dementia or stroke, it is best to consult an older lawyer.

This professional can help you complete important steps, such as placing a healthcare agent and designating an enduring power of attorney. They can also advise you on the best way to manage the finances of elderly parents.

2. Who will handle long-term care?

Another problem is long-term care planning.

This discussion is not just about money. It involves figuring out where your parents will live and who will take care of them.

If your parent has difficulty living independently, discuss the type of care he or she wants.

Most elderly people want to stay in their homes for as long as possible with the help of family members and home health assistants. Others may eventually need to provide 24/7 care in nursing homes or assisted living facilities. Understand your parents’ preferences and discuss the cost of each option with them.

This can be challenging, but listen to your parents and listen to their opinions. Don’t start a conversation just to impose your own views and opinions.

It’s hard to think of becoming incapacitated, and older people often struggle to cope with emerging restrictions, disability, and poor health.

They may feel that they are losing their independence, especially when they encounter difficulties in their daily activities. In these conversations, patience and compassion can go a long way.

If your parents are young and healthy, buy one Long-term care policy You can save a lot of money for your family. However, if your parents are older or in poor health, the price of the policy may be too high.

You may want your parents to live with you when their health declines, but remember that you may need to buy equipment or remodel your house to safely accommodate them.

Or you may want to consider hiring a part-time healthcare professional to help.Find out what Long-term family health services What Medicare covers and what assistance you may have to pay out of your pocket.

It is always important to consider what would happen if your other parent or their current spouse died first. If your father always helps your mother with grocery shopping or drives her to the doctor, if he dies, who will bear these responsibilities?

Talk to your brothers and sisters

If you have brothers and sisters, it is important to be consistent with them.

Children who live nearby may become de facto caregivers—even if they don’t want to or can’t take responsibility. A child who lives far away may feel excluded from an important decision or feel guilty for not providing more help.

Keckler said it is important to talk about any imbalance. Siblings usually have their own financial and family obligations to deal with, so sharing everything is not always an option. One person may be able to pay more than another.

Acknowledging this would help.

“Trust each other in the different types of support and care for parents,” Keckler suggested. “I think if brothers and sisters can ensure that they recognize each other’s contributions, this might be a way to ease tensions.”

A sibling who lives far away with limited financial resources can still help take care of mom and dad in other ways.

For example, handling online banking, paying bills, ordering household goods, or scheduling appointments can be a huge help, and these tasks can be done remotely with relatively little effort.

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3. Are there important estate planning documents?

As our parents get older, it is important to ensure that estate planning documents are in place, especially wills.

A will, sometimes called the last will and testament, clearly states who will receive your assets after you die. If your parents pass away, it is up to the state to decide who will receive their houses, cars, and other property.

In most states, assets are passed on to close relatives, starting with the spouse, then children, parents, siblings, etc.

If your parents remarried recently, their spouse will most likely inherit everything. This may or may not be what your parents want. People usually think that their children will get a house or a fishing boat, but if they are still married and have no will, this is not the case.

Family dynamics are complex, and unwilling death can reveal the ugliest aspect of human nature. At best, it can be confusing and disappointing for loved ones, and at worst it will be caught in a hostile lawsuit.

It is best to have an open conversation with your parents now to avoid confusion.

First, ask if they have a will. If so, please find out where it is and when it was last updated.

You can create a simple will online, but most experts recommend having a lawyer draft one. It may cost a few hundred dollars, but the money is well worth it, especially if your parents own multiple assets, own a business, have a complicated financial situation, or have a mixed-race family.

If you need to make changes to your will or estate plan, go to a lawyer with your parents and complete any changes. Don’t let your parents make changes by writing their will or entering a new one without notarization. Doing so will invalidate the entire document.

Many states provide legal aid resources for seniors or eligible low-income individuals.

To save money, ask a lawyer for estimates and get quotes from several different companies. Always make sure to take advantage of the free consultation.

Inquire about power of attorney and living will

A lawyer can also help you draft other important estate planning documents, including power of attorney, advance instructions and living wills. These documents specify someone to manage your parents’ affairs when they become incapacitated. They also describe the end-of-life healthcare that your parents want or don’t want.

The Health Insurance Portability and Accountability Act (HIPAA) restricts who can access private health care information, so it is important to sign a document that allows you to access your parents’ health documents.

Keckler recommends filing the power of attorney and living will in the hospitals and doctor’s offices where your parents may go, and keeping a copy for yourself.

Ensure that the beneficiary designation is up to date

It is also important to ask if your parents have any life insurance policies. Insurance can help pay for long-term care, final expenses, and funeral expenses.

Life insurance policies, 401(k) accounts, annuities, pensions, and brokerage accounts all have their own beneficiary names. Over time, people often forget to update these files, which can cause headaches, heartaches, and distress after someone dies.

For example, your father may still list his ex-wife as a beneficiary of the Roth IRA even though they have been divorced for ten years.

Even if you are listed as the main beneficiary in your father’s will, the IRA may still be passed directly to his ex-wife.

Check to make sure these files are up to date and contain the current wishes of your parents.

How to start a conversation

These conversations are not easy, but they do not need to cause disagreements. Ensuring that everyone feels valued and heard is the key.

It is important not to wait for something to force these issues to start a dialogue.

Keckler suggested finding a natural catalyst to bring up this topic, such as:

  • Suppose you just met with your financial planner and think you should have a family.
  • Talk about a friend who is dealing with a family crisis. Let your parents know that you want to avoid this conflict by sitting down and having an open conversation about money and the future.
  • Tell your parents that you recently scheduled a meeting with a lawyer to draft your own will. Ask them if they have done any estate planning, and if so, what is the process.
  • Write your thoughts in an email or letter in advance. People communicate differently. If you write it down first and share it with your parents before sitting down to talk, it may be easier to lead the conversation or describe your feelings.

Before the actual conversation, figure out what your goals and priorities are. What should you talk about now and what can you wait for?

other suggestion:

  • Continue the conversation: Schedule time to discuss these issues on a regular basis.
  • Define roles and responsibilities: Each sibling may help in different ways. Talking about expectations and roles can ease tensions.
  • hear: Keep an open mind and be patient. Money is hard to say.

Involving an objective third party is another way to break the deadlock. Financial planners can help facilitate dialogue because they have experience and know the most important topics to discuss.

“The families who completed this report are better than they thought, and they are more financially confident,” Keckler said. “Overcoming your concerns and getting started is a good first step, and you will be glad you did.”

Tiffani Sherman is a freelance journalist based in Florida with more than 25 years of experience writing on finance, health, tourism, and other topics. Senior writer Rachel Christian contributed to this report.

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