Although it can be an uncomfortable experience, there comes a time when every child has to discuss estate planning matters with their aging parents.
It can be a tough conversation to have, especially if your parents (or you) are avoiding the subject, but there are ways to address their needs for their elder years and end-of-life wishes successfully with a little tact and preparation.
Here's an overview of the most important factors you'll want to cover with your parents sooner rather than later.
Health and Medical
With age, comes increased medical needs and concerns. Take the time to review your parent’s current medical coverage and conditions to make sure they are able to receive the care they need.
· Review their healthcare insurance coverage
· Assess if long-term care insurance is a good option for them
· Address any limitations or future limitations that need to be planned for logistically and financially
· Make sure they have (and you understand) their healthcare proxy
· Identify who has durable power of attorney to express their wishes and make healthcare decisions if they are unable to speak for themselves
Financial and Legal
It's best to address financial and legal matters before your parents face a difficult circumstance, like the loss of a spouse, cognitive difficulties, or other healthcare concerns that could make it more challenging for your parents to share important estate planning information with you and their long-term care wishes.
Regarding financial concerns, be sure to ask and find out:
· Do they have enough savings for unexpected expenses?
· Retirement income to live off of?
· Other assets that they eventually plan to sell or transfer?
· Charitable giving plans?
You'll want your parents to feel in control of their money and privacy as much as possible, so don’t approach the conversation like an interrogation. Instead, simply make yourself available to them to help them manage their affairs.
And aside from knowing if they are adequately covered financially, there is certain information you will need in order to best help them with any of their financial and legal affairs, especially if the parent who usually handles these matters is no longer able to:
· Name and contact information of their financial advisor or CPA
· List of all their financial accounts/holdings, who to contact regarding these accounts, and who has access to them besides them
· Name and contact information of their attorney
· Location and information on all the insurances they carry (health, long-term care, etc.)
· Access to their living will and/or last will and testament
· Access and information for their power of attorney (if it’s not you) over their financial accounts should one or both of them become deceased or disabled
· Access to their healthcare proxy
· Access to tax returns
More than anything, it will be invaluable to you to know what their wishes are from them directly rather than trying to figure it out after they are no longer around or able to communicate with you directly.
Many estate planning attorneys also offer to video tape their clients communicating the wishes they decided upon in their will so that there is no misunderstanding by their beneficiaries of what they wanted after they are gone.
In addition to legal and financial matters, you'll need to talk to your parents about some practical concerns as well.
For example, if you don't live in their proximity, who will be their support system when they require it? Is there a third party who can intervene in times of difficulty? Do they have trusted friends who could fulfill this role if necessary? If the answer is no, it’ll be important for you to work with your parents to make decisions regarding their care when they need it eventually.
Perhaps at a certain point, your parents will come to live with or near you or another sibling, or you can arrange for in-home professional assistance or an assisted living community. Either way, this shouldn’t be decided for your parents; you should discuss all their options and learn what they and you are ultimately most comfortable with.
At the end of the day, this isn’t a conversation about how old your parents are and how needy they will become. This is a conversation that gives them a voice to share exactly what they want with someone they love and trust more than anyone in this world. Parents spend a lifetime taking care of you and being self-sufficient. Reassure them that they aren’t a burden, and that you just want to help make sure that you do your best to help them maintain their independence as long as possible.
Knowing what your parents want, properly and legally documenting their wishes, and preparing for the unknown (but inevitable) can provide a tremendous amount of comfort and peace later for both you and your parents.
Lake Road Advisors wants to help you find the right financial advice.
We've put together a comprehensive whitepaper to learn about different financial designations and organizations, how advisors are compensated, and steps you can take to find the right advice. Click below to get started.
Read more from Lake Road Advisors below:
- Jun 10, 2019 The Biggest Question You Might Ask About Social Security Benefits: To Wait or Not to Wait? Jun 10, 2019
- May 20, 2019 2 Critical Ways to Hold Yourself Accountable to Better Financial Decisions May 20, 2019
- Apr 29, 2019 The Psychology of Money, Part III: Pay Now But Consume Later and Invest in Others Apr 29, 2019
- Apr 1, 2019 The Psychology of Money, Part II: Make it a Treat & Buy Time Apr 1, 2019
- Mar 4, 2019 The Problem with Federal Spending - and How It Impacts You Mar 4, 2019
- Feb 11, 2019 The Best Way to Handle Stock Market Ups and Downs: Get Used to Them Feb 11, 2019
- Jan 14, 2019 2 Important Tips on How to Manage the Household Finances as a Couple Jan 14, 2019
- Dec 3, 2018 Can Money Buy Happiness? Dec 3, 2018
- November 2018
- Oct 31, 2018 Lake Road Advisors Announces New Partnership with Vestwell Oct 31, 2018
- Oct 22, 2018 6 Biases That Can Impact Your Financial Behavior Oct 22, 2018
- Oct 8, 2018 Open Enrollment is Coming: Are You Adequately Covered? Oct 8, 2018
- Sep 24, 2018 What Today’s Economy Means For Investors Sep 24, 2018
- Sep 10, 2018 Recent Grad That Can’t Find a Job? Here’s What to Do Sep 10, 2018
- Aug 20, 2018 How Your Financial Planner’s Network Can Help Aug 20, 2018
- Aug 6, 2018 These 2 Accounts Offer the Best Tax Advantage and Here’s Why Aug 6, 2018
- Jul 23, 2018 The Big Difference Between a Fee-Only & Fee-Based Financial Advisor Jul 23, 2018
- Jul 9, 2018 Why Titles Mean Little and Designations Mean Everything Jul 9, 2018
- June 2018
- May 21, 2018 The 5 Most Common Estate Planning Mistakes Parents Make May 21, 2018
- May 7, 2018 Here’s Why You Need to Think About the ROI of Education May 7, 2018
- April 2018
- Mar 26, 2018 Get Beyond The Price Mar 26, 2018
- Mar 12, 2018 Index Funds and Passive Fund Management: Understanding the Opportunity Mar 12, 2018
- February 2018
- January 2018
- Dec 11, 2017 The Psychology of Saving Money: Why some do it successfully and others struggle Dec 11, 2017
- Nov 27, 2017 Why Your Child's 529 Plan Should Be Direct Nov 27, 2017
- Nov 13, 2017 Get on the Road to Financial Success with These 4 Behaviors Nov 13, 2017
- Oct 30, 2017 Know the Lingo - the daily market recap and how it affects you Oct 30, 2017
- Oct 16, 2017 The 3 Unbreakable Rules for Financial Success Oct 16, 2017
- Oct 2, 2017 Follow These Steps When Selecting a Financial Advisor Oct 2, 2017
- Sep 18, 2017 Why You Should Choose a Fiduciary as a Financial Advisor Sep 18, 2017
- August 2017
- Jul 24, 2017 How Am I Doing? Jul 24, 2017
- Jul 10, 2017 Do I Pay Off (Student Loan) Debt or Do I Invest Instead? Jul 10, 2017
- June 2017
- May 29, 2017 Diversification: The Right Way to Manage Risk May 29, 2017
- May 15, 2017 Having A Tough Conversation & Helping Your Aging Parents May 15, 2017
- May 1, 2017 What Everyone Should Be Doing Post-Tax Season May 1, 2017
- Apr 17, 2017 Want to Raise Financially Savvy Kids? Try These 5 Steps Apr 17, 2017
- Apr 3, 2017 Inflation: What Every Investor Needs to Know in 2017 Apr 3, 2017
- March 2017
- February 2017
- January 2017
- Dec 26, 2016 5 Steps to Get Your Finances Ready for 2017 Dec 26, 2016
- Dec 12, 2016 How Much Should I Invest In My Company Retirement Plan? Dec 12, 2016
- Nov 28, 2016 How About What Not To Do With 401(K) Contributions Nov 28, 2016
- Nov 14, 2016 Keeping it All Together: How to Balance Personal Financial Goals with Running Your Business Nov 14, 2016
- Nov 1, 2016 Nervous About The Election And Your Investments? Nov 1, 2016
- Oct 16, 2016 30-Somethings: Why are You Wasting Time Following the Stock Market? Oct 16, 2016
- Oct 3, 2016 Will 30 Year Old's Ever Get To "Retire"? Oct 3, 2016
- September 2016
- Aug 8, 2016 Why Budgeting Doesn't Need to Be a Dirty Word Aug 8, 2016
- Jul 18, 2016 What Does a Financial Planner Do? Jul 18, 2016
- June 2016
- May 16, 2016 It's Urgent, But Is It Really Important? May 16, 2016
- April 2016
- March 2016
- February 2016
- January 2016