In our last blog, Talking to Your Aging Parents About Money – Part 1, we explored ways adult children could start the conversation about money with their parents. Once the ice is broken, an opportunity to deepen the conversation presents itself.
The "money" subject is the first of several layers of important issues aging adults need to address. The following are major ones adult children need to discuss with their parents.
Locating important documents should be tackled first. This may take some effort. Such documents have accumulated over many years and may be stored in many different places. Among these documents are:
As a part of this exercise, identify any safe deposit boxes and the keys and passcodes needed to access the boxes. Adult children should have their names added to those authorized to access the boxes. An inventory of the contents of each box should be made.
A list of contacts should be assembled, including include family, friends, and professionals. This will serve as the master list of people to be contacted in case of illness or death. It needs to be updated periodically. The list of professionals should include:
As noted in the Documents section above, wills and other estate planning paperwork needs to be located. If no will exists, adult children should push their parents to have one created as soon as possible. Without a will, state laws dictate how an estate is distributed rather than the deceased's particular preferences.
There may come a time when an older adult ("principal") cannot manage their own affairs. Whether temporarily or permanently, another person ("agent") must be authorized to act on their behalf. Power of attorney (POA) is the legal mechanism for enabling this.
There are several different types of POAs.
Rules for POAs may differ by state. Adult children and their parents should consult an attorney to understand POA options applicable to their specific circumstances.
Another essential document is the advance healthcare directive. Sometimes called a living will, it contains an individual's preferences for handling their medical care. An attorney is not needed to create this document, but many legal professionals will assist with this if desired.
Sharing an updated list of medications with adult children is also prudent. In an emergency, the information may be crucial in delivering effective medical treatment.
Similar to healthcare, older adults need to consider their preferences for future senior living arrangements. Most people intend to live independently at home as long as possible. It's a smart move, however, to discuss potential scenarios with adult children. This way, all factors, including financial, can be thought out ahead of time.
No one likes to talk about death, but putting off the discussion of some basic preferences could cause future anxiety for loved ones. For example, letting others know of your choice of cremation or traditional burial will settle one crucial question. Sharing preferences for funeral arrangements and the final disposition of remains will further relieve the pressure on family and friends.
Not all the above subjects directly touch on money. However, opening up the conversation about money can lead to broader information sharing that will lead to peace of mind for both aging parents and their adult children.
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