Talking to YOUR Parents

You have figured out how you want to teach your children about money and are ready to set them on the path to a healthy financial lifestyle. Now are you ready to discuss money with your own parents? If you are like most, the answer to that question is a resounding “NO”. Although it is a difficult subject to broach, it is a necessary one. Often we are afraid to start the conversation because it means we have to think about the possibility of illness, disability or death. But not having the conversation may leave you and your parents vulnerable should an unforeseen circumstance have you answering financial, health or estate questions on their behalf.

Starting the conversation doesn’t mean that you expect your parents to divulge their balances or give over the keys to the ‘kingdom’. It does mean understanding on a broad basis what they have, where they keep it and what they want done with it. It is just as important for them to understand your concerns. As a start here are a few broad areas to get the conversation heading down the right path:

• Discuss your own financial plans and the strategies you have set in place to cover any circumstances in the future. If you have not started a financial plan, ask your parents how they started theirs and what advice they would give.
• Let them know that you are concerned that should anything happen their interests are well-taken care of. This means you need to understand what assets and liabilities they have - in general terms. If they are comfortable sharing details, fine but it is not necessary. What is necessary, however, is that there is a list of accounts, insurance plans and locations where important legal documents are kept. Likewise, having the details and keys to any safety deposit boxes is critical. The list must also include the names and contact information for their lawyer, accountant or other financial advisors.
• Everyone wants to avoid issues over a family will – as hard as it may be – encourage an open discussion about the general contents of the will and what their intentions are. Having that conversation with all interested parties can clear the way going forward. This also means understanding your parents’ feelings about health related preferences. As their child, it may be your responsibility to make health related decisions and you will want to respect their wishes – ask your parents if they have documented their wishes as it relates to health care. If they have not, suggest they speak with someone about a living will.
• Many financial institutions have a power of attorney set-up – but be clear, a power of attorney has to be set-up at each financial institution. This is a difficult subject to broach but is very important if your parents are not able to make sound decisions for whatever reason.

Having the conversation is part of the estate-planning process and will insure that when the time comes everyone is well-prepared and able to make the best possible decisions. If you are not sure where to start or if you or your parents need some help – talk to us. As your financial advocate, we are here to help you and your family every step of the way.