Communicating With Aging Parents About Money

It’s one thing to talk about “getting older,” but initiating a conversation about physical decline and the possible loss of independence can be a challenge. Some aging parents won’t feel comfortable discussing their situation, even if they clearly need help. Others may be more comfortable than you are.

It can be a tricky talk – some older parents may not be receptive to the notion that they need (or could need) assistance, feeling their independence could be compromised. On the other hand, it can be difficult for children to step into the advisory role their parents may have filled for nearly a lifetime.

Whether you have one big conversation or a number of smaller ones, some of the topics you’ll need to cover include:

• Your parents’ financial, insurance, and legal affairs.
• Their health status and how to handle any costs if their health worsens.
• Their wishes during a health emergency and after death.

The more you talk about these issues, the more comfortable you and your parents will become. After all, the goal is to provide the best care possible for your parents. Ideally, you and your parents will work together as a team - discovering their wishes in addition to their needs.

When to Start

Elder care issues rarely seem pressing (until they are), but one thing is certain – the earlier you start, the better prepared your family will be. In fact, there are many reasons to start the conversation early with your parents:

• You may be able to help them make sure they have done everything they can to preserve their estate, including proper insurance coverage.
• You may be able to help them take advantage of resources they might not have known about, such as free or low-cost services, discounts at stores, free rides, activities, and alternative living arrangements.
• There are a growing number of communities and long-term facilities that require people move in before they require skilled nursing care. It’s much better for them to move to one of these places when they’re young and healthy enough to take advantage of what they have to offer, including social activities and exercise options.

How to Start the Conversation

The first thing to remember is that the purpose of your talk is to gather information, not counsel them emotionally. So while this conversation often results in a discussion of feelings, what you’re really after are facts, plans, and a status report. Whether that comes as a result of many discussions or a written response to a list of questions doesn’t really matter. The focus is to get answers to your questions.

If you aren’t sure how to get started, here are some approaches to talking with aging parents about their future:

• Direct: “I’d like to talk with you about the future. There are lots of things I need to know about. Is this a good time to talk?”
• Written: “Here’s an article/book/chapter I think might be good for you to read. I think it’s really good and helpful. After you’ve had a chance to digest it, I’d like to talk with you about what it says.”
• Third Party: “I’m concerned about the future and wondered if you’ve talked with your lawyer/accountant/advisor. If not, would you do so? If you have, do you think it would be good for me to talk with him/her or to have all three of us talk together?”

Whatever approach or combination of approaches you use, pay attention to your parents’ lead.  Be sure to listen to their answers and be open-minded about their wishes.

Knowing What To Discuss

You can't have a productive conversation if you don't cover the basics. To comprehensively address your parents' future situation, it's important to ask questions that include:

• Where are your financial records and accounts? This includes accounts with brokers, retirement plans, bank accounts, IRAs, etc. It's also important to ensure you have the log in information, including user names and passwords. 
• What is the situation with regard to healthcare? Are they using Medicare? Medicare Advantage? Is long-term care coverage in place?
• Do you have enough income and savings to finance your retirement? How much can you draw annually without exhausting your nest egg? Do you have a budget?
• Has any estate planning been done? Are directives in place for end of life care and relevant financial questions?

By covering these fundamental questions, adult children can develop an in-depth view of their parents’ financial situation and take corrective steps in necessary.