Thelma Brown, 65, is a retired school teacher. Her son, Jerome Haynes, taught her how to do a monthly budget. So that it will be simpler for her, he created a written spreadsheet for her to use to write down her income as well as her expenses. He taught her how to save and she now has a savings account of her own.
“She really didn’t know much about finances and ended up biting more off than she could chew,” Haynes says. “I moved her near me, and we sat down and wrote out a budget for to live by. We talked about life insurance and where important documents are in the house when we need to locate them.”
Herb White, CFP, MBA, certified planner and president of Life Certain Wealth Strategies, says talking to aging parents about money can be difficult for several reasons. Uncomfortable questions are raised such as who receives what after a parent’s death, who should control the parent’s finances, what assets parents have, wills and trust and what they include, and parents fear of losing control of their own finances and lives. To alleviate some worries, adult children can have an agenda of items to be discussed and involved the aging parent’s trusted adviser or attorney.
“One solution is for the adult child to remind the parent that you love them and want to make certain they are financially alright, that their needs are provided for and wishes will be respected,” says White. “Adult children should begin to talk with their aging parents about money, sooner rather than later, so that you don’t wind up having conversations during a family crisis.”
Some items placed on the agenda during the family meeting are required minimum distributions of retirement accounts, Medigap polices, Medicare Advantage and part D plans, long term care policies, taxation of Social Security benefits, avoiding investment scams, will preparation, and reverse mortgages.
For more information on this topic, check out the following books: The Retirement Savings Time Bomb, But What if I Live, and Retire a Winner: Your Complete Retirement Planning Road Map and Social Security Essentials.