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Week of 1.23.09

Advice: Talking About Money
By Teresa Arnold, AARP

Adult children often feel like clumsy intruders asking even the simplest questions about their parents' finances. And parents are just as likely to feel intruded upon. A careful, caring approach is crucial, but it is also essential to deal openly and objectively with the subject.

checkbook If this subject is too fraught for you and your parents to deal with, don't forge ahead at the risk of jeopardizing your relationship with them. It's usually best to make "the conversation" at least a two-stage process, first opening up a break-the-ice dialogue between your parents and you, just to get the lines of communication going. Later, you can arrange for a separate nuts-and-bolts conversation—a family meeting—to discuss specifics. Although you'll need to consider the best circumstances for bringing up the subject, don't get frozen waiting for the perfect opportunity. An emergency might beat you to it.

A few tips for breaking the ice:

1. Don't go in with preconceived notions about what your parents might say; approach with an attitude of listening, not telling.

2. Make references to yourself and your thoughts about your own future.

3. Avoid the word "should". Your ultimate goal is not to tell them they need help, but to have them realize it for themselves.

4. Rather than waiting for your parents to bring up the subject, be alert and take quick advantage of any comments they make.

5. Offer help. This is a way of broaching the subject indirectly and may provide an opening to further discussion.

6. Be direct and show your concern. Do not be confrontational. Instead, use "I" messages. Tell how you are feeling, not what they need to do. Remember, you're in this together.

After you've broached the subject and your parents have indicated they want your involvement, the next thing to do is to find out where their finances stand. Here are some sample questions. You may want to be less direct, depending on your and your parents' comfort levels.

Questions to ask:

  • What are your current and likely future bills?
  • Can you pay for what you need?
  • Do you need help getting government or pension benefits?
  • What about financial planning to make your money last?
  • Are your Social Security and pension checks deposited directly in the bank?
  • Is all your financial information in one place?
  • What about getting extra income from the equity in your house?
  • Have you considered that you might need money down the road to help pay for assistance with everyday activities?
  • Do you have any bills you can't pay?
These additional resources from AARP can help plan and organize your parent's financial information:

Independent Living: Starting a Dialogue

Document Organizer

How to Deal with Long-Distance Issues

Which Type of Financial Professional is Right for You?

AARP's Quick Tips for Saving Hundreds of $ per Month

Financial Implications of Going Back to Work after Retirement

Loss of Retiree Employer Benefits

Protect Your Home: Mortgage Payment Tips

Is My Money Safe?

Caring for Your Parents, The Complete AARP Guide

Over Fifty, Overdrawn

In Your State: Senior Status

Advice: Talking About Money

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