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4 Tips for Performing a Financial Checkup with Your Aging Parents

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Last time, we talked about those of us in the sandwich generation broaching the subject of personal finances with our aging parents. In the next few posts, we’ll delve into more practical steps.

The physical, mental, or spiritual wellbeing of your parents may be your main concern. However, it’s important to also understand their financial health so that you can focus on the quality of time you spend together. Just as with physical health, the first step toward a positive accurate diagnosis and treatment is to perform a checkup.

Learning Their Roadmap

When you go in for a checkup at the doctor, they look at the past (your stats – weight, blood pressure, etc. – from your last checkup), present (current stats), and then help you make a healthy plan for the future.

[minti_pullquote align="right"]Be patient, ask open-ended questions, and listen carefully.[/minti_pullquote]A financial checkup basically takes the same approach. It’s not just about the immediate picture or needs. It’s about keeping an eye out for red flags and helping your parents manage their complex finances so they can enjoy the resources they’ve worked so hard to build or maintain.

As the saying goes, you can lead a horse to water but you can’t make them drink. You may have to warm your parents up to these suggestions. Don’t try to ambush them and tackle everything all at once, especially if discussing personal finances has not been a part of your relationship in the past.

You may even want to review the first article in this series so you can plan how to ground these conversations in realistic expectations, focus on how important it is for you to help ensure your parents are well taken care of, and help ensure that their legacy goals are fulfilled exactly the way they planned for

Once you understand this is a process, and not just a conversation, you can begin to follow these four tips that can help guide you when you do a financial checkup with your parents.

1. Watch Out for Elder Fraud

A recent study estimates that “older Americans lose $36.5 billion each year to financial scams and abuse.” Your parents may not be experiencing diminished mental capacity, so don’t make the conversation about that. Assure them you want to be able to be their advocate if and when they can’t make complex decisions as easily as they used to.

Again, remind your parents you want to help ensure that they are taken care of and that their legacy goals are fulfilled. One way to do this is by helping them avoid falling prey to financial scams. It’s important that both you and your parents do not underestimate the potential this kind of abuse has to derail carefully laid out financial plans.

What You Can Do:

If you aren’t already, start to pay more attention to the latest news regarding elder fraud schemes. Talk to your parents about what you’ve read. Ask them if they had heard about any new elder fraud schemes on the news or from one of their friends. You may find them most receptive to this kind of help, especially if they know of someone that lost retirement savings through fraud.

Ask your parents what you can help them with and let them know what you are learning about these schemes. The National Council on Aging compiled a list of some of the most prevalent forms of elder fraud that can help spark discussion. Positioning any of these tips as a partnership with your parents can help break down any barriers to having this conversation.

If your parents have been the victims of a fraud or if you believe they are becoming more susceptible to it, you may want to take a more proactive approach. Make sure they have the proper estate planning documents in place and read the next tip.

2. Consider Getting Online Access to Your Parents’ Bank Accounts

In the world of finance, technology continues to make things more convenient and accessible for everyone. Your parents may not even have set up online access to any of their accounts but they may be on a first name basis with everyone that works at their local bank. Make an appointment to go with your parents to the bank so their favorite banker can show your parents how easy and helpful accessing accounts online can be.

If your parents understand how pervasive financial fraud is among the elderly, they may learn to appreciate that account alerts that can help protect them. If they feel like their privacy or independence is being impinged upon, you may want to slowly build up to monitoring your parents’ bank accounts by starting with just having them include you on e-mail alerts. Help them understand that you don’t want to tell them how to spend their money, you just want to keep a close eye on the daily transactions to help protect them against unexpected surprises and the threat of elder fraud.

What You Can Do:

Ask your parents if they would be okay with giving you access to their online banking profile(s). Another option is to open a joint account with them so you can easily add money and help them make decisions regarding their finances. This should be a part of your ongoing conversation around your family’s estate. These conversations are best had before a major health complication makes it difficult to have at all. Remember to be gentle, listen carefully, and acknowledge their concerns.

3. Are Their Investments Are Aligned with their Goals?

Are your parent’s still saving for any goals, like young grandchildren’s education? Have they achieved their retirement goals and now are focused on estate and legacy planning? Are they currently working with a financial planner, CPA, or estate planning attorney? Are they actively monitoring their portfolio or relying on someone else to do that?  Remember, even if your parents are financially well off, that doesn’t mean they have taken care of everything that should be addressed in order to meet their goals long-term.

Ask your parents to teach you how they learned about investing. Ask them what resources they would recommend to help you make better financial decisions. Even if you have a well-qualified financial planner, tell your parents you would like a second opinion from theirs. Let them make the introduction and give you permission to look at their portfolio. Tread lightly here, but be persistent. If they are used to keeping these cards close to their chest stay focused on their legacy and how you can help ensure their wishes are honored.

What You Can Do:

Set up a meeting with your parents and their most trusted financial advisor. If they don’t have one, and are used to doing everything themselves, remember to be patient but persistent. Keep the door to this conversation open by asking them questions such as:

  • of their friends who have passed, which ones had the best and worst outcomes when it came to settling the estate?
  • What do they think contributed to that outcome and what did they learn from those situations?

Use this as an opportunity to learn more about how your parents make difficult and complex decisions. While the goal here is to ensure that their assets are invested appropriately for their goals and risk tolerance, the path to get there may not be a straight line or a single conversation.

4. Review Their Income Statement or Budget

Your parents’ budget may not be similar to yours right now, but they may have been similar when they were at the same stage of life as you are right now. They can probably relate to your expenses - paying for groceries for your whole family, gas for multiple cars that commute to and from work and school, children’s college, your own retirement savings, and more. At this stage of their lives, your parents may have a large number of charitable contributions, additional business ventures, multiple homes to manage or any number of other complexities. While you are trying to be a resource for your parents, the challenge is that they may be used to being the expert and the one you come to for advice.  Ask them to help you prepare for further success in your future to gain insight into how prepared (or unprepared) they are.

Even if your parents have enough liquid assets or income to support their lifestyle indefinitely, understanding their income statement or budget can help them teach you how to care for the assets they leave behind. We may think we want to keep the family home until we find out how much it costs to maintain or how much the property taxes have increased over the years. Ask your parents to show you how they budget, and if they don’t do it very well, ask them how they think you should handle their resources when the time comes. Once you’ve made it this far in your relationship, and they have shared their income and expenses with you, you may find they are more open to your advice.

What You Can Do:

Set up a time near the end of every month to sit down and review your parent’s income, expenses, and goals. Make an afternoon of it by having lunch together first, so everyone has a full stomach and can focus on the task at hand. Don’t get caught up in the method at first, just learn what you can. Once everyone gets more comfortable with this process, they may be more open to finding the best tools or advisors for their situation.


These four tips may seem like a lot of work, and if that’s the case for you, remember to be patient, ask open-ended questions, and listen carefully. Even if you know there’s a better way to handle their finances, you will most likely have to meet your parents where they are at. Use these tips to find new ways to connect with your parents, learn more about them, and their history. While you have the luxury of time and can have clear conversations, focus on learning how they found their answers before you ask them to listen to your solutions. As stressful as it can be to talk about finances, you may find this process strengthens your relationship with your parents while helping everyone be prepared for the inevitable.


Next time, we’ll turn our attention to the various options for housing you will need to consider with your aging parents.


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