Financial challenges come in many shapes and sizes and, at some point, await all Americans. An aging society — 72 million baby boomers born between 1946 and 1967 — may witness one of the greatest wealth transfers in American history as older Americans pass on inheritances to younger generations. But some who did not prepare as well for retirement may find themselves needing the help of their children or other family members.
Many times, the latter years of life can lead to changes in family dynamics. Fortunately, it’s possible to ease this time during life with intentional communication among family members regarding finances. A series of "money talks" may be on the schedule for your family. In order to conduct these discussions wisely and efficiently, we’ve put together a few discussion points for your family to consider:
- Long-term care. What are the expectations of older family members, and what are the fiscal and physical capabilities of younger ones? Around 60% of seniors will need some kind of long-term care in their later years. And depending on the type of care needed, family members may lack the capacity and necessary schooling to provide the care, even if they have time. Understanding everyone’s expectations and abilities can help alleviate frustration, guilt and anger later. GuideStone® provides a Long-Term Care Calculator to help determine if you’re financially prepared and provides insight on frequently forgotten costs that come with retirement.
- Inheritance. Most adult children have something in mind they’d like to receive from their parents following their passing: a particularly sentimental pearl necklace or Dad’s trusty tool collection. Have a discussion of what items will be willed to whom so that there are few surprises when the day comes to divide up the family’s possessions. And remember: it’s important to remain selfless and keep an eternal perspective in these sensitive situations. People in mourning can react in different ways, and before we let selfishness flare its evil head, let’s remember Matthew’s words: “Do not lay up for yourselves treasures on earth, where moth and rust destroy and where thieves break in and steal, but lay up for yourselves treasures in heaven, where neither moth nor rust destroys and where thieves do not break in and steal. For where your treasure is, there your heart will be also” (Matt. 6:19–21).
- Last wishes. Make sure you discuss family members’ expectations following their passing. Do they want to be cremated? Buried in the family’s hometown cemetery? Don’t assume everyone knows what the preferred plan is unless it’s been explicitly discussed. Additionally, ensure that at least one trusted family member knows where important paperwork is filed, any life insurance policies you have or veterans’ benefits for which you may be eligible. Talk openly and honestly about living wills, burial wishes and other end-of-life needs. Most children want to honor their parents’ wishes —don’t make them guess, especially when they’re mourning.
As we all age, important decisions need to be made. If you'd like more resources regarding how to best plan for aging family members' retirement, please access our Preparing for Retirement resources designed to help you.
Article 