As your parents grow older, it is important to consider how they manage their finances. Having a conversation about money management is never comfortable, but the time spent up front dealing with this issue pays off down the road. The minor stress of today’s conversation reduces stress and conflict among family members at a later date. If your parents’ are retired and entering the stage of life where health care is a concern, it is vitally important to talk to them today about their finances.
Initiate the conversation by scheduling time with your parents and other family members to discuss finances, healthcare, and money management issues. Start the first meeting out by describing the reasons for coming together. Stress that the basis of the conversation is love for your parents. You want to ensure that they are taken care of appropriately in the future. As your conversations evolve, consider the following:
Determine if there is an estate plan and/or other legal documents, such as a will, trust, and healthcare directive. Identify their attorney and make contact with the attorney to let them know who you are and that you are in conversation with your parents regarding their plans for the future.
Health coverage and insurance concerns are important. Be sure to know what plans your parents have, who their doctors are, and if they have any preferences with regard to their healthcare should they become incapacitated.
Figure out your parents’ monthly expenses and how their Social Security, pension, retirement funds, and other sources are used to cover those expenses. Locate the files for all banking and brokerage accounts.
Locate all tax returns, account statements, and other paper financial records such as property ownership information. If there are online accounts, acquire and securely store all usernames and passwords. This will save you hours of frustration and possible state intervention at a later date.
These areas are your focal points as you help your parents, and the entire family, move into their later years with a solid plan. Once you understand the finances, you can refocus on enjoying your time together and celebrating a life well-lived.