It’s not enough that we have to psych ourselves up for “The Talk” with our pre-teen kids these days. More and more of us are also having to have a different kind of Talk with our aging parents. This Talk (with a capital “T”) actually involves more asking than telling on our part. As our parents age we find ourselves wondering if they are really prepared for end of life matters. Do they have a will? What about long term care insurance? How much is the monthly mortgage payment?
According to the Employee Benefit Research Institute, only 40% of adult children know their parents’ income amounts. That leaves a majority of us wondering if mom and dad are going to outlive their resources or be able to take care of increasing medical needs as they age.
If your parents are still in good health, living active lives, chances are they don’t necessarily feel the need to share their financial situation with you or your siblings, which can make initiating a discussion uncomfortable. But when is the right time? When one parent gets sick? After one has died? In most cases, the best time, in fact, is right now. So here’s what you need to ask:
Do they have a will?
It’s surprising how many people don’t have a will, thinking everything will pass smoothly to a spouse or children. But who gets the heirloom brooch that was Aunt Millie’s? Having a basic will in place can ease the burden of dividing assets among children and enforce any charitable giving wishes. While you are on the topic, go ahead and ask about other basic estate planning documents as well. Do they have a durable Power of Attorney, giving you or a sibling authority to act on their behalf if necessary? What about trusts, health care directives and living wills? If the answer is “no” offer to set up an appointment with a local estate planning attorney.
What are their long term care/end of life wishes?
This is where a living will becomes important. Do they want to be on life support or not? Would they prefer to stay at home as long as possible if they become incapacitated or are they all set to move to assisted living? Do they have long term care insurance? Getting parents to articulate their vision of end-of-life care can be difficult. Better to find out now if their idea of assisted living is to move into your in-law apartment…
Who are their advisors?
Do they have an estate planning attorney, a financial advisor, a tax accountant? If so, ask if you can arrange a joint meeting between you, your parents and the advisor so you can understand their situation a little better. A good advisor will welcome adult children, as the risks of misunderstanding by elderly clients increase with age.
Do they have a list of assets and expenses?
While few parents prepare balance sheets and income statements, more and more do have some system in place to keep track of their expenses. Ask them to explain where they have accounts and how they pay their bills. If the system works for them, don’t change it! But this is often where aging parents start to struggle and because it can happen gradually, they often don’t ask for help until there is a financial crisis.
Where are the documents?
I can’t tell you how many times I’ve heard “I know they had an insurance policy but I can’t find the documents anywhere.” Have them tell or show you where the important documents are kept. These could be not only insurance policies, but the will, durable powers of attorney, car titles, the deed to the house or even the passwords for online access to bank accounts. If they are stuffed in a drawer along with receipts from 1972, you may want to suggest a safety deposit box.
For some parents, asking these questions won’t be easy. Nor will it be accomplished in one conversation. Ease the way with a difficult parent by using humor and telling stories. If your best friend had a nightmare of a time sorting out her deceased father’s affairs or a colleague at work had to find Alzheimer’s care for his mother, tell the story. It may just open the door to a more personal conversation.