For many of my clients in their 50s and 60s, the next hot button topic is: “I am worried about my aging parents. How do I talk to them about their care and their finances?”
The challenge is that the adult children are uncomfortable thinking about these issues and in many cases their parents don’t want to talk about it.
There might be many reasons: They don’t want to lose control of their money; they believe it is a private matter; they don’t want the kids to take advantage or lose their motivation to work; they are too proud to say there isn’t any meaningful money.
Some of these concerns might be very valid, but there are tremendous benefits to being able to have the discussion.
These benefits can include:
Significant savings can be had through proper planning around spending, gifting, estate planning and government grants.
Less stress :
Free your parents who need financial help from their children from stress, or in some cases for children who could significantly benefit from a small ‘early inheritance’ while they need the
You can save tremendous time, cost and family stress by having clear and open discussions about the parents will, powers of attorney over health care and property, where documents are held, and what the parents’ wishes are.
Having open discussions about realestate plans, can help to ensure that the parents are in the appropriate type of space for their needs. By delaying this conversation, parents often live on
their own for too long, in part because of long waiting lists for the residences of their choice. This also has meaningful financial implications given the value of many houses today.
Maximizing government grant opportunities ;
There are a handful of provincial and federal grants or forgivable loans that benefit seniors – especially those that have to spend money to make their residence more accessible. http://www.seniors.gc.ca has some good information on these types of programs. The Home Adaptation for Seniors Independence program is through CMHC. Low to mid income seniors (and in
some cases their children) can receive up to $3,500 in a forgivable loan.
Dealing with declining mental ability :
This is a tough one, but a reality. There are a number of studies that show that one’s ability to make financial decisions declines by about 2% a year after age 60. This often means that someone in their 80s or 90s is struggling with financial decision-making even if they don’t recognize it or choose to admit it.Given the concerns and the benefits, approaching this topic is tricky.
The first step is to start the conversation. Start with a story about the difficulties a friend had dealing with the same situation and ask what they would have done or think should have happened. Involve parents as much as possible, respecting boundaries.