Talk the Talk

Written by Dan Seaborn on . Posted in Local

danseabornEventually the time will come. The time when a parent and an adult child will need to have the talk. No, not that talk. That discussion should have happened around middle school age. This is the talk about a parent's financial situation as it relates to retirement and any future medical care.

According to a new survey by Fidelity Investments, adult children and parents are at odds about discussing difficult topics such as elder care, retirement security, and inheritance. These conversations are not taking place like they should. It seems that adult children are reluctant to approach the subject of money with their parents, because they're afraid bringing it up is disrespectful. Parents, on the other hand, are hesitant to talk to their children about their finances and medical insurance situation, because they don't want to burden them. Therefore, both sides stay silent because each party thinks it's none of their business. But it's more about taking care of business now, instead of waiting until there is a crisis. It's about people acting according to a plan instead of reacting spontaneously in a catastrophe.

Problems arise because both sides have different expectations. For example, the survey revealed that 24% of adult children expect that they will have to help their parents financially at some point but 97% of parents don't expect to need help. Think of the relief those parents could give to their children by initiating a few discussions about their financial future and sharing that good news with them.

This doesn't mean that parents have to disclose their entire financial portfolio to their kids, but it's a good idea to just initiate discussions about the future. It might be as simple as parents sharing whether or not they have long-term healthcare insurance, a 401K plan, or other investments. They can speak to their children in generalities about their plans for retirement.

According to the survey, when it comes to medical care, 97% of the parents and adult children disagreed on whether a child will take care of the parents if they become ill. Planning in advance and letting your children know what to do if certain situations arise would help turn these unknown expectations into known entities.

Of course these conversations aren't going to be totally comfortable, but some financial disclosure is necessary in order to get both parties on the same page. The survey also unveiled the fact that adult children underestimate the value of their parents' estate by more than $100,000 on average. Are you beginning to see the need to talk? If the thought of this conversation is too far out of your comfort zone, then consider bringing in a financial advisor. They will help get the conversation moving in more of an analytical direction versus an emotional course.

Another area of concern for parents is to determine who will be the executor of their estate. It's possible they won't pick any of their children, but rather an outside party they trust. It's not always an easy choice, especially if you have more than one child. Some children feel slighted, while other children will feel relief at not being selected. The responsibility doesn't automatically fall to the oldest child. Parents know their own children best and they will select the right individual.

Although having this talk may not be easy, it will create a lot of peace in your family by clearing up misconceptions and unrealistic expectations now for the sake of the future.
Author Information
Dan Seaborn
Dan Seaborn is the founder of Winning At Home, Inc., an organization designed to assist and encourage people of all ages and stages of family development. As a featured speaker at churches and large-scale events such as marriage conferences, corporate functions, and university assemblies, Dan Seaborn has earned recognition as a powerful and passionate communicator. Through practical illustrations and memorable real-life examples, he encourages individuals and families to lead Christ-centered homes.

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