How to Talk to Aging Parents About Money

When was the last time you had a serious conversation about money with your aging parents? If you’re like me, it’s been a while. Maybe you’re avoiding these topics because they can be uncomfortable or awkward. Over the years, I have helped clients navigate these conversations with their aging parents and have had similar conversations with my own parents. These strategies can help you learn how to talk to aging parents about finances and begin these important discussions with greater confidence.

Tip #1: The Intention

Before you talk with your parent(s) about money, decide what your intention is. Do you want to understand how they handle cash flow or pay bills so you can assist before an emergency? Find out how they make big financial decisions and whom they trust. Elder financial scams are common, so knowing who is involved in their financial lives can provide added protection.

You may also want to understand where they plan to live if they become incapacitated or what happens if one parent dies first. These questions can bring up very real fears about the future, so remain understanding and sensitive to any feelings that may surface.

Tip #2: The Space

Find a quiet, comfortable place to talk. Money discussions can feel intimidating, especially if this is your first time talking to parents about money. Sharing some of your own fears about money or explaining how you handle financial decisions in a story-like way can help put your parents at ease.

Watch how you present yourself. Don’t sit directly across from your loved one because this can feel confrontational. Instead, sit next to your parent(s) so they can hear you without straining and the conversation feels more relaxed.

Retirement income should also be part of the conversation. Do they know where their income will come from, including Social Security, pensions, retirement accounts, savings or other sources, and whether it is likely to support their needs? Consider taxes, healthcare costs and the possibility that one spouse may live many years longer than the other.

Estate planning for aging parents should happen before an emergency or death. If these questions become complicated, working with a CFP® professional can help families look at retirement income, spending, investments, taxes and estate planning and identify potential gaps before they become emergencies.

Tip #3: The Time

Take time to sit with them and listen to their stories, fears, successes and the legacy they want to leave. Keep it casual, like you are talking with a friend.

You need to gather information before an emergency, but rushing the conversation may shut it down. Some generations grew up thinking money was too personal to discuss. Make sure they know you will keep their information private while explaining why it’s important to understand the details of their finances now.

Tip #4: The Assumptions

Don’t be judgmental when you hear stories about financial failures or decisions that didn’t turn out as planned. Don’t assume they have all their ducks in a row; ask them.

Financial literacy is not age-based. Many women in my generation or older allowed someone else to make financial decisions and can be intimidated by having to make those decisions themselves. Listen for where they may need or want help.

Tip #5: The Ask

Everyone likes to give advice, especially when they are your parents! Asking them what to do with your money, how to budget or how to make financial decisions can make them feel valued and part of the conversation.

Older adults have life experiences that have taught them about money even without formal training. Ask them to teach you something and sit back and learn. Your goal is to serve as their trusted advocate and partner.

Financial planning for aging parents doesn’t always have to begin in a formal setting. Sometimes it’s best to simply start the conversation and keep building on it so you can help your loved ones maintain the quality of life they want as they age.