Are your parents ready for retirement? Do they have enough retirement portfolios to cover their long-term needs? These are some of the tough questions that you may have to ask your aging parents at some point. It won't be easy to plan for retirement.
According to a study by GOBankingRates:
- Over 70% of American adults have never had extensive discussions with their aging parents about their finances,
- Close to 40% of those interviewed said it wasn't an important topic,
- 23% tried but their parents refused to answer,
- About 20% were too afraid to initiate the discussion, and
- 17% mentioned it's taboo to talk about money in their family.
Financial experts acknowledge that it is not uncommon for aging parents to talk about their finances with their kids. But they reiterate that the earlier you talk with your parents about their retirement, the less conflict, and disappointment you may have to endure in the future.
You just need to know what to ask and how to do it in such a way that it doesn't offend your parents or make them feel uncomfortable. That's what we'll help you achieve today.
The Ice Breaker: What Do You Envisage for Your Retirement? What Do You Plan for Your Retirement?
If you've never talked about money with your parents, this is a great starter. Apart from helping you know your parents' goals in retirement, this question also ensures you're all on the same page.
If they're receptive, use the discussion to share what you think your parents should be considering. But don't be pushy. Let them do the talking while you listen.
The Income: Are You Happy With Your Retirement Portfolios So Far?
Here, you want to know whether your parents have set aside enough money to cover daily needs like housing, healthcare, transportation, and more. This is also a good time to visualize what their days or weeks will be like in retirement.
Determine what budget they need to maintain that lifestyle. If they plan to work during retirement, this is where you will know.
Emergency Preparedness: Have You Looked Into Long-Term Healthcare?
Medical and healthcare costs can take a toll on family finances. As such, it's wise to know if your parents have an insurance policy that can cover costs beyond Medicare coverage. If they don't have one, advise them to get such coverage even if they don't think they will need it.
IRI reports that close to 70% of seniors aged above 65 are more likely to require long-term care. But only 25% of these seniors believe they will need it or plan for retirement.
Use such statistics to help your parents see the need to prepare for medical emergencies in retirement. It'll show them you care about their health and quality of life.
Legal Matters: What Do You Want Your Legacy to Be? Is It Legally Documented?
Retirement can bring about tough decisions that should be made. And some of them need legal processes and documentation.
So, assure your parents that you want all their wishes to be met even when they're gone. Request to share with you their plans.
Here you want to know what plans they have for their properties, and who will make important decisions in case your parent is incapacitated. These are important questions to ask when you have siblings. It helps avoid conflict.
Lesson Time: What Financial Advice Would You Give to a Young Adult?
If your aging parents have never talked about money, this is a good question to end the discussion. It could lead to seeking help from a financial professional. Help your parents understand that it's not too late to start planning for retirement.
Help Your Parent Plan for Retirement
Helping your parents plan for retirement is not easy. Getting them to talk about their finances is even harder. But these are important discussions that you must have. Without them, it would be harder for you and your loved ones later.
Be open, honest, and mindful of your parents' feelings when approaching the subject. It's OK to bring useful research, news articles, and documents to demonstrate the importance of asking these questions. Good luck!