Talking to Aging Parents about Finances

A Difficult but Important Task

Discussing your parents' finances can be uncomfortable, but many financial professionals agree the conversation may be necessary. Bringing up the topic when your parents are still young-around retirement age and in good health-can be your best bet. In the best-case scenario, parents take the precautions of naming their executor, health proxy and power of attorney long before they need to rely on other people to help them. Unfortunately, many aging parents do not take these steps for a variety of reasons, including fear of their own mortality. You can be understanding and assure your parents that you don't want to control their lives. Reassure them that you just want to have the knowledge you'll need in order to help them in the future if necessary.

What You Need to Know

Besides your parents' health care proxy and power of attorney, you might need to know all their sources of income, such as Social Security, retirement accounts and pensions, and health insurance information. A list of where to find bank accounts with statements, insurance policies, deposit boxes, the deed to their house if they own one, a will and other financial information can be kept in one place and updated regularly. If one sibling is assigned financial responsibility, he or she should make sure to keep other siblings informed so that misunderstandings are less likely. As uncomfortable as this conversation may seem, chances are that parents and children will be glad that these financial affairs have not been left to chance, and your parents' care and wishes will be honored. Think about talking with a financial specialist beforehand in order to know exactly what questions you should ask your parents about their finances. When you do talk to your parents, try to see things from their perspective and help them see it from yours. When it's over, you all might feel relief.