Parents always want to know about their kids’ well-being - even into adulthood. What type of career will you pursue? Did you get your annual check-up? Have you started a retirement account? But one day the tables turn. Then, the adult “kids” find themselves talking to aging parents about their financial and medical needs.
While this role reversal can feel uncomfortable, learning details about your parents’ situation is crucial. You may find peace of mind in knowing they have plans in place. Or you may find there are areas to address now. Either way, it’s important to know the facts while their mental and physical health is still sound.
So , you may want to take the time to have “the talk.” You’ll gain insight into your parents’ situation and that can set the stage for future honest talks. To start, here are some questions you may want to ask:
1. What happens if you can no longer manage your affairs?
If your parent becomes incapacitated, they need legal documents appointing someone to make medical and financial decisions for them. This is usually called a power of attorney (POA). A POA form gives someone the authority to act for another person in legal, financial or health situations.
There are different types of POAs and some are designed for very specific purposes. For example, you could have one POA for your property and another for your personal care and health-related choices. POAs may also have different names and signing requirements depending on the province you live in. So be sure to do a little research and read up on which documents your parents may need. You can also consult a lawyer for help obtaining and writing up these documents.
You may also want to ask your parents if they have a will in place. A will sets out what you want to happen to your belongings and your estate when you die.
What happens if your parents don’t get a will? Or if they die without a will in place? Then the law decides who will manage their estate and who gets what.
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2. What’s your retirement plan and how will you manage your finances?
If your parents intend to retire soon, discuss their proposed plans—and if they’re able to fund them. A first step is to help your parents create a budget. That will provide an accurate picture of their obligations and ballpark the amount they have left for leisure. They may envision a retirement of traveling and golf, but their budget might indicate otherwise.
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Before they leap too quickly into retirement, talk to them about the potential for a “phased retirement.” That might mean downshifting to a part-time position, or a married couple staggering their retirement timelines. This is also a good time to double-check whether your parents feel comfortable managing their finances on their own. If not, it could be time for someone like an advisor to step in and assist.
An advisor can help your parents build a solid financial plan suited to their needs and lifestyle. According to the 2019 Sun Life Barometer, people who work with a financial advisor feel more secure in retirement. In fact, 62% of Canadians with an advisor are satisfied with how much they’ve saved for retirement. This is compared with 37% of those without an advisor.
3. Is it time to stop driving?
Not long ago you were the one begging for keys to the car, while your parents worried about your safety. But according to Transport Canada, seniors consistently top the list for most driver fatalities of any age group. Surrendering the car keys may feel like a loss of independence, but offering solid solutions can soften the blow.
Talk to your aging parents about alternatives to driving. That might include public transportation and other local community resources available to senior citizens. If you live close enough, consider taking them with you on your weekly grocery run. You’ll get to spend some time together while checking a task off your list.
4. Where will you live?
Sometimes the family home isn’t favorable to aging in place. A steep driveway, narrow hallways or second-floor bedrooms might not be ideal for an older person. Talk to your parents now about whether the home can be retrofitted to their future needs. If not, it might be time to consider downsizing.
If they’re thinking about moving to a warmer climate, help them sift through the pros and cons. Those include considerations about social life, health-care choices, public transportation and other needs. Suggest they try out any new region with a long-term rental, rather than selling everything and moving somewhere sight unseen.
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5. Would you consider a retirement home for your long-term care needs?
While talking to your parents about where to live now, ask about where they plan to live in the long-term. A long-term care community, like a retirement home, is worth consideration. Some aging parents hesitate to consider it at first. But visiting one often reveals a vigorous clientele and a full slate of activities. Your parents may appreciate the opportunity to forgo housework and yardwork. Plus, consider the security of knowing they can access more care as their health dictates.
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6. Do you have the right health insurance?
Paying for future health needs can be a looming budget buster. It’s wise to ask about your parents’ plans to fund potential future care. A health insurance policy like a long-term care insurance plan can be an investment in peace of mind. Long-term care insurance can help your parents:
- receive home care so they don’t have to downsize or move to a facility right away,
- lessen the burden on care-givers and family members who provide financial support, and
- manage their care and expenses if they have an unexpected severe accident.
It can also be more affordable the earlier you purchase it. Consider asking your parents to look into the possibilities and securing their future this way.
Talking to aging parents about changes can be difficult. But, in the long run, the payoff is peace of mind for both of you.
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