When we start to see the signs of age showing for our parents, it’s time to have an honest conversation about financial planning. Granted, the time to start thinking about retirement planning is not when you retire, but when you’re young and lively. There’s no time like the present to take stock of your family financial situation. Conversations about money can be very difficult to have with parents, but it’s important to have them, especially if you’ll be their primary financial caretaker as they get older.
Talk About Expectations For Retirement
Talk with your aging parents about their retirement planning. Hopefully this conversation can happen while they’re still working, and you can work with them to ensure that they’re on track to have their financial needs taken care of when they retire.
If they’re not on track to have a comfortable cash cushion, do they expect you to care for them? Are you prepared to care for them financially and/or physically? What assets do they own that could be liquidated to pay for expenses if the need arises? Getting these expectations on the table can help your parents craft a retirement plan that works for them and the rest of the family.
If your parents were lucky enough to retire from a company that continues to pay for health insurance, they’re in great shape. But nowadays most people are not able to obtain that kind of medical insurance benefit, either because their company doesn’t offer it, or they didn’t work for an organization long enough to be entitled to such a benefit.
Have a conversation about the current and future health insurance needs with your aging parents. Do they have an ongoing medical condition that’s expected to continue or worsen into old age? Are your parents at risk of developing a new condition? Help them check out their health insurance options, and don’t forget about Medicare, which you can even have as a secondary payer if you have primary health insurance coverage with a private insurer.
Long-Term Care Insurance
Long-term care insurance can pay for expensive long-term nursing home care that many elderly people need. The last thing you want is for your elderly parent to run out of money while staying in a nursing home. Planning ahead is key because the best time to buy long-term care insurance is when you’re 50-60 years old. (1) After that, premiums rise. For most adults, it’s about a 50-50 chance they’ll need nursing home care, and thus have a need for this insurance.
Could your parents afford to pay out of pocket for both to have a lengthy nursing home stay? An unfortunate and often repeated circumstance is that one parent requires a lengthy nursing home stay, which spends most of the couple’s retirement savings, leaving the surviving spouse without enough money to pay for their own nursing care. Consider your family’s options, talk to your parents’ doctors, and have a conversation with an honest professional at Beacon Wealth Management to determine their needs.
Discuss The Will
If your parents don’t have a will, they should draft one. Making a will doesn’t have to be daunting, and for most families with an uncomplicated financial picture, it can be inexpensive. Have your parents write down their wishes and take it to an attorney in their state since wills are state-specific.
If your parents already have a will completed, make sure it’s valid in their state and up to date. Then encourage them to discuss it with all family members involved. This helps to avoid any potential squabbles that could arise.
Pursue Your Dreams
Our mission is to help you make smart decisions about your money. We aim to always have the most up-to-date understanding of your personal situation. If you’d like to learn more about actions to take to help your parents, please do not hesitate to reach out. You can contact me at (304) 626-3900 or email me at firstname.lastname@example.org.
John is the founder and owner of Beacon Wealth Management. He specializes in helping entrepreneurs, professional practitioners, and retiree red-zoners overcome the major financial challenges facing affluent families.
As a trusted and friendly financial partner, John delivers a collaborative client experience that empowers and guides people to reach a greater purpose for their wealth and pursue their financial dreams. He understands the multifaceted set of financial worries people face as they become more successful and get within the retirement red zone.
John is well-regarded throughout the business community for his expertise. He has appeared as an expert guest on the The Brian Tracy Show and Hollywood Live with Jack Canfield, is the co-author of the book Masters of Success with Brian Tracy, is the host of the WDTV News 5 segment “Solutions 4 Financial Independence,” and has conducted hundreds of educational events on Retirement and Investment Advisory, Tax Reduction, and Wealth Transfer Planning. These include many Universities, Federal Employee Organizations, Professional Associations, and Large Energy Companies throughout the eastern United States.
With more than two decades of experience, John is credentialed as a Certified Wealth Strategist (CWS), Accredited Investment Fiduciary (AIF), Certified Estate Planner (CEP), Chartered Federal Employee Benefits Consultant (ChFEBC), Professional Plan Consultant (PPC), and Registered Financial Consultant (RFC). He is also a past multi-year member of Ed Slott’s Master Elite IRA Study Group.
A native of Weston, West Virginia, John served in the United States Air Force prior to becoming a Wealth Advisor. Today, he resides with his family in Clarksburg, West Virginia. He and his wife, Lisa, have been married since 2005 and have three amazing children. A family-oriented man, he is passionate about giving back to his community, coaching youth sports, landscaping, architectural design, and playing racquetball.