Have "The Talk" with Your Parents About Money
Three Tasks You Can Do This Month
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Whether you're just getting the ball rolling or you're in the throes of helping your aging parents plan their future, here are three things you can do this month that will give all of you more piece of mind.
1. Determine what assets your parents have.
Happily, your parents will probably live a lot longer than their parents did. It would be nice if whatever they've stockpiled for retirement could last as long as they do. In order to make that happen, you or a trusted financial adviser need to sit down with your parents and get a handle on how they are living today. Do they have a substantial pension? Are they relying mostly on Social Security? Do they have enough to cover their daily needs and any health care costs going forward? Are they depending on their home equity to see them through? Once you or another trusted individual understands how much money your parents have, you can begin to plan successfully for the future.
2. Take care of the big three.
The most important information you need to gather from your conversation with your parents is whether or not they have the following documents that will allow you or someone else they trust to manage their health and financial needs if they become ill or incapacitated.
3. Write a letter.
If you can't bring yourself to talk to your parents directly about their financial situation and the future, or if they simply refuse to answer your questions or respond to your concerns, try putting your questions and feelings in writing. Send a note with a recent relevant article. Or just write to them about how you feel and list the specific questions you have. Emphasize that you care about them and you're asking because you love and respect them and want them to have a happy future. Then put your letter in the mail before you have time to censor yourself.
1. Determine what assets your parents have.
Happily, your parents will probably live a lot longer than their parents did. It would be nice if whatever they've stockpiled for retirement could last as long as they do. In order to make that happen, you or a trusted financial adviser need to sit down with your parents and get a handle on how they are living today. Do they have a substantial pension? Are they relying mostly on Social Security? Do they have enough to cover their daily needs and any health care costs going forward? Are they depending on their home equity to see them through? Once you or another trusted individual understands how much money your parents have, you can begin to plan successfully for the future.
2. Take care of the big three.
The most important information you need to gather from your conversation with your parents is whether or not they have the following documents that will allow you or someone else they trust to manage their health and financial needs if they become ill or incapacitated.
- A living will tells a doctor or hospital whether or not your parents want life support.
- A health care proxy is a document that gives you or another individual the power to make health care decisions on your parents' behalf.
- A durable power of attorney for finances gives you or someone else the power to make financial decisions on your parents' behalf.
3. Write a letter.
If you can't bring yourself to talk to your parents directly about their financial situation and the future, or if they simply refuse to answer your questions or respond to your concerns, try putting your questions and feelings in writing. Send a note with a recent relevant article. Or just write to them about how you feel and list the specific questions you have. Emphasize that you care about them and you're asking because you love and respect them and want them to have a happy future. Then put your letter in the mail before you have time to censor yourself.
Please note: This is general information and is not intended to be legal advice. You should consult with your own financial advisor before making any major financial decisions, including investments or changes to your portfolio, and a qualified legal professional before executing any legal documents or taking any legal action. Harpo Productions, Inc., OWN: Oprah Winfrey Network, Discovery Communications LLC and their affiliated companies and entities are not responsible for any losses, damages or claims that may result from your financial or legal decisions.
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