7 Ways to Assist Your Parents

7 Ways to Assist Your Parents

Smart Ways to Help Your Parents with their Retirement Savings

by Guest Blogger Rick Pendykoski

If you’ve got aging parents as well as children of your own to look after, you’re part of the “sandwich generation”. You may want to ensure secure future for both your parents and your kids, the stress of juggling these responsibilities can become overpowering. Retirement is becoming more expensive, but have your parents been investing for it?

If you’re wondering whether this is any of your business at all, let’s first lay your doubts to rest. Consider what could happen if your parents haven’t saved for retirement. The impact of their financial negligence can affect your own retirement planning, children’s college funds, and day-to-day expenses.

How Can You Help Your Parents if they’ve Neglected Retirement Planning?

A lot of us worry about how our parents will manage health care and living expenses after they retire. It may seem like an uncomfortable topic to discuss with them, but you need to know. After all, most people haven’t got enough retirement savings, and you may need to balance your parents’ needs against your own.

Here are 7 ways to help your parents save for retirement:

  1. Have an Open Discussion – Talking about money can be awkward, but you need to start the conversation. Be respectful, gentle, and honest about why you’re asking. Make it clear that you aren’t trying to pry, but instead to help them plan for a more comfortable and secure future. Most importantly, avoid being judgmental about their financial choices. Look at tomorrow instead of yesterday.
  2. Don’t Waste Any Time – If your parents haven’t been investing for retirement or don’t have enough saved, you need to start working on a plan right away. While it’s never too late to begin putting money aside, the sooner the better. By making the right investments now, their savings will have time to grow and you will be better able to help them manage their finances as well as your own.
  3. Get the Details – After you get a general feel of your parents’ financial health, work with them to collect specific details of their debt, expenses, 401k or IRA savings and income, will and estate plan, etc. If you can, ask other family members or siblings for support. Working as a team and pooling your resources will ensure that the financial burden of caring for parents doesn’t fall on you alone.
  4. Start Paying Down Debt – If your parents have loans, mortgages, credit card bills and other debt, consider making payments toward one or more. You could also take a personal loan to refinance their debt if you want more control over the account. Doing this now will help reduce their financial burden and your own, but make sure they won’t just use it as an excuse to add on more debt!
  5. Set Clear Expectations – If you’re offering financial support to your parents, be clear about how much you’re willing or able to do. Losing your own financial security won’t do you or them any good, so be honest about your limitations and the support you can comfortably provide. For instance, you may be able to help them find affordable housing or care for them in your own home.
  6. Prioritize Your Future – Whether you’re saving for a child’s education or your retirement, don’t neglect your personal financial goals while helping your parents. Your own financial circumstances may plummet in the blink of an eye. If guilt makes you want to put their needs first, imagine your children taking on the burden for your care when you’re older. Avoid that vicious cycle.
  7. Stay on Track – If you’ve set up a financial plan with your parents, check in on their progress regularly. If they think you’re trying to control their finances, gently remind them that the goal is their financial independence later in life. You could also hire a financial planner to guide them with a self-directed IRA, debt repayment, tax incentives and other investment advice.

With teamwork and careful planning, you can help your parents achieve a comfortable, safe and happy retirement. All this, without neglecting your own financial health!

Author Bio:

Rick Pendykoski is the owner of Self Directed Retirement Plans LLC, a retirement planning firm based in Goodyear, AZ. He regularly writes for blogs at MoneyForLunch, Biggerpocket, SocialMediaToday, NuWireInvestor & his own blog for Self Directed Retirement Plans. If you need help and guidance with traditional or alternative investments, email him at rick@sdretirementplans.com or visit www.sdretirementplans.com.

 

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