Talking to your older parents about finances can be challenging. Typically, parents have dealt with financial matters privately and competently for most of their lives, and a sudden stream of questions from their children can feel intrusive. For adult children, it can also be awkward because they don’t want to appear greedy or controlling at a time when their parents are feeling vulnerable on a number of fronts.
Whether you’re in the process of increasing your role in your parents’ finances or if you’re planning to do so in the future, these tips can help you gain the right mindset for a smooth, successful transition.
Create a Game Plan
If you have siblings, have a preliminary conversation with them to work through any points of conflict before talking to your parents as a united front. Working out potential issues ahead of time can make the entire process much more seamless and reassuring.
It’s also important to set up a family meeting to discuss finances when everyone is healthy and well, as opposed to the midst of a health crisis when stresses are compounded and thoughts are scattered.
Respect Your Parents’ Knowledge
Financial conversations will be much more effective and fruitful if you approach them with sensitivity and non-judgement. The perceived role reversal can be difficult for many parents, so it’s important to be positive and conduct yourself in a non-threatening way. Offer guidance rather than demanding control. Communicate that your love and desire to help are driving your questions, and that you are not making a power grab. Make an effort to understand their financial strategy up to this point, and don’t be too eager to suggest changes right away.
Start Small, Then Create a Strategy
It may be best to ease into financial conversations by covering basic topics that will help you and your siblings become more familiar with your parents’ money and where it is located. Here’s a good start:
- Where are your will and trust documents?
- Who is your health care proxy?
- Where are your bank accounts?
- Where are your investments held and what is the contact information?
- Where is your safety deposit box? Where is the key?
- Where are your life insurance policies located?
From here, you can begin to develop a strategy that could lighten their load, which might include:
- Adding your name to certain accounts, so you are authorized to help when needed
- Helping to set up automatic bill payments
- Helping to set up automatic deposits
- Offering to help with bank reconciliations each month. Some aging parents in cognitive decline lose their ability to do simple math.
Financial planners can be a key partner throughout this process. They can make recommendations for investments or help you plan for medical expenses and long-term care.
Don’t expect to take on a key role in your parents’ finances overnight. The transition will take time, and it may be difficult for your parents to let go of something they’ve handled so closely for decades. This is completely normal. Take this in stride and don’t try to rush your parents if they aren’t quite ready.
Additionally, your parents may repeat the same stories or feel the need to re-hash topics you have already discussed. Listen with love. Recognize that this may be their way of expressing something they think you didn’t fully appreciate. Or, perhaps there is an important lesson they want to pass on to you.
Check in Regularly
Keep the conversation going and review your strategy and plans periodically to ensure your parents remember what you have all agreed to. Consider establishing regular meetings or financial check-ins. You can chip away at a new aspect of your parents’ finances at each gathering, or you can set aside time to discuss your siblings’ recommendations.
For many people, financial topics are sensitive and emotionally charged. Your initial conversation may be a bit rocky, but if you are prepared and understand the importance of easing into a more prominent financial role, you’ll ultimately find an agreement that works for you and your parents.