Children often have little knowledge of what their parent’s financial situation is. Sometimes even the surviving spouse is left in the dark.
Poor communication often creates unintended consequences and the results can be detrimental to a surviving elderly spouse.
Studies have shown that most families recognize the importance of having an open discussion about a number of issues concerning a parent’s situation as they approach their later years. Unfortunately, for many families, and even between spouses, this discussion never occurs and the result is not knowing how to deal with situations as they arise.
The discussions may not be pleasant, but the consequence of not knowing can be both emotionally and financially burdensome for the elderly person and their family.
How to address these problems – Framing the discussion
- Assets – What assets exist and where are the assets located? In whose name are they in and their value?
- Liabilities – What liabilities and debts exist? The amount owed? In whose name are they in?
- Insurance policies. What policies exist? The amount of coverage? Where are the policies located? And, are the premiums being paid?
- As the situation changes should we consider assisted living or a nursing home? If the need arises – who should have a financial power of attorney? A need for a durable power of attorney for health care? Does a will exist? Is the will current? Is there a need to create a trust and what would be the benefits of creating such a trust?
When is the timing right to begin the discussions.
Here are some helpful tips:
It’s never too early to start the discussions. The earlier you begin the better you and your family members will be prepared.
The majority does not control. It should be the parent who has the final say about finances and health care.
Maintain control and discipline. Family dynamics can be troubling. Know what roles everyone should play.