If you’re fortunate enough to have family to spend Thanksgiving with, consider the time you have together as more than a chance to eat, watch football, and nap. Those too-infrequent times you have with your parents and/or your children are golden opportunities to talk about some of the financial things we always mean to talk about, but seldom do.
People of my vintage and older may have been brought up the way I was—financial matters are private, and not to be discussed with “children.” Unfortunately, in my house, we never stopped being children to my parents, and it’s only now, when my father is gone and my mother is 84 and overwhelmed that I am allowed to learn of their financial plans. I am, in fact, now the co-executor of my mother’s estate. And yet she still won’t let me see her bank statements, and when I reminded her that it will be a nightmare for me if she insists on holding assets outside of the trust that was created to hold all of her assets, she said, “I don’t mind—I’ll be dead.” Uhm, thanks Mom!
This letter from Joe Dietsch to his son was originally published in 2005, but it’s as relevant today as it was then. If you are a parent with college age or older kids, don’t keep them in the dark. One day you may need them, and the more they know the better. Remember also that these are the people who will pick your nursing home :). If you’re the adult child of an elderly parent and don’t know what their plans are, please consider having the discussion with them over the holidays when you’re together (but not at the Thanksgiving Dinner).
Some topics of discussion with your family might include:
For Adult Children and Their Parents
- Have they created an “In Case of Emergency” (ICE) book* of any sort? If so, where is it?
- Do you have a safe deposit box? Where is it? Who is deputized? Where is the key?
- Do you have a will? Is it up-to-date? Where is it?
- Do you have a health care proxy? Who is it? Where is the paper?
- What are your end of life wishes? Have you signed a “Do Not Resuscitate” (DNR) order? If so, where is it? More importantly have you discussed your wishes explicitly with your designee?
- Who is your executor?
- Where are your accounts held?
For Parents and Their Children
- Do you have any credit cards? Do you understand how much you end up paying for things you buy on credit?
- Have you ever checked your credit score?
- Do you know how to build a good credit history?
- You’re working now—does your company offer a 401(k) or other savings vehicle? Are you participating?
- You have earned income—have you opened a Roth IRA or regular IRA? Do you understand that you can deduct contributions on your income tax returns?
- What are your goals? Do you wish to own a home or condo?
The list of things could go on and on. The questions above are but a sample of the many things that people often fail to talk about.
Remember the old adage about not planning to fail, but failing to plan? Opening up the lines of discussion is a good first step. Revisit our blog posting called: Teach Your Children Well (About Money).
Contacting your Trusted Financial Advisor is an excellent second step!
Best wishes to all of our clients and friends this holiday season.
* if you need help in preparing an ICE Book see our earlier blog posting about it here