Are Your Parents Your Greatest Risk?
As you may or may not have realized, money is never really just about money- especially where family members are concerned. One of the most challenging relationship issues you may have is when your role with your parents starts to change. It is possible that this may never happen. But many people find that in their lifetime they go from being told what to do by their parents, to getting advice from their parents, to sharing ideas with their parents, to advising their parents, and sometimes to telling their parents what to do or doing it for them. As people live longer, we believe this may happen more and more as a natural cycle. We also believe that open, trusted communication between the generations is one of the best ways for everyone to enjoy and cope with the changing roles.
If you are one of the lucky ones, your parents have done their planning, review it often, and communicate with you what they are doing in detail. If you don’t have that information, and your parents are starting to have health issues or are over the age of 70, it may be time to start these conversations, so you don’t end up with any surprises down the line.
One of the challenges with growing older is that everyone runs their own race. One 80-year-old may be completely competent and running a business (or a life that operates like one) and a 70-year-old may be frail and needing skilled nursing care. Unfortunately, there is no “do this by a certain age”. Instead, preparations and conversations should happen before declines. Since we don’t always know when a physical or mental decline is going to take place, this can be challenging. In our office, we use these guidelines:
Health Status of Your Parents
What You Should Know
|Excellent- they have no issues.||Who are their decision makers in an incapacitation (advisors, doctors, etc) and where are their important documents stored?|
|Very Good- they are starting to have signs of slowing down.||All of the above, and ideally before they are in this stage you have met with their advisors, know the gist of their medical issues, and have confirmation from them that their legal and financial house is in order.|
|Good- they may need assistance with either health care, financial management, or day to day living such as transportation.||All of the above, and ideally before they are in this stage you have reviewed their financial, legal and medical situation with them in detail so that should you need to step in, you can do so with respect and ease. If you are their decision maker, you have that documentation.|
|Fair- they need extensive help and are no longer able to be independent in either their mental or physical capacity (or both).||All of the above, and ideally before they are in this stage you know what is important for them about how they make decisions and their priorities regarding end of life issues.|
|Poor- they are no longer capacitated.||All of the above, and ideally before they are in this stage, you have a good working relationship with the people who help care for them.|
In an ideal world, your parents would simply sit down with you before each change in their health and share what is needed. This rarely happens, as most people think they have more time or don’t want to think about ever needing more help. It’s legitimately scary as few people want to be dependent on others. How do you get them to share? Here are some conversation starters that have worked in the past:
- “I am working with a financial planner (or doctor), and they suggested some things to me about my finances (or health). Can I share them with you, and you can share with me some of the advice you have received?
- “I am thinking about my future, and of course you are a part of that. I am wondering what kind of planning you are doing and what role you would like me to play in that so I can be there for you the way you have been there for me.”
- “I have been reading absolute horror stories about people getting taken by fraud and abuse. Do you want to share some ideas on how we can protect ourselves?”
- “A friend of mine feels like she is really letting her mom down. They have had some health issues and I guess there was no communication with her for what they wanted. She has to make health and financial decisions for them with no input from her mother, and it’s been very hard. Do you think we could begin some conversations about your future so I will know what you want me to do?”
- “Will you come meet my advisor and tell me what you think of them? I’d like a second opinion.”
You know your parents best. Trust yourself to know how to ask them difficult questions. At some point, they let you borrow their car- they will probably let you in on this if you try. If you are lucky enough to have time, it’s important to go slow and just keep the conversation moving forward. If your parents are reluctant, keep gently letting them know you are there for them. Most importantly, don’t put your own head in the sand.
This life transition can be difficult and awkward, but for many it can also be healing and helpful. Most likely, it will be all of the above. Like most things in life, planning for it and acting on those plans, in our opinion, can make the experience much better for all involved.