Managing Parents’ Retirement – How to Transition

Your parents—or perhaps other important figures in your life like a close relative, mentor, or family friend—may have played a vital role in shaping your understanding of money and supporting you through life’s early stages. As they age and enter retirement, the roles often reverse. While the topic can feel sensitive, helping manage the retirement needs of those who once cared for you is an important step in ensuring their comfort, security, and dignity in their later years.

How to Get Started in Managing Parents’ Retirement

Talking about money can be challenging, especially with older generations. When introducing this conversation, please note that it is not a financial takeover. You are not removing an aspect of their independence, but becoming an asset they can rely on should they need you. We suggest approaching this as another life lesson they can teach you, using themselves as the case study.

Start by Learning their Financial Situation

The first task you and your parents need to do together is to gather all your parents’ financial information. This will not only include bank, investment, and retirement accounts information, but also:

• Mortgage, car, and other loans
• Insurance policies
• Critical documents, such as wills, trusts, deeds, and property titles.
• Private information, such as social security numbers, driver’s license numbers, Medicare/Medicaid numbers, and Veteran ID numbers, among others.
• Location of safety deposit box or other safes, including passcodes, keys, or numbers.

Afterward, you will want to make sure that you have the appropriate legal documents to act on your parent’s behalf, including both financial and healthcare Power of Attorney. Just make sure that after you have these legal documents signed, you share them with your parents’ financial and healthcare institutions so they are aware and accept the change.

Learn Their Financial Goals and Wishes

After you have a full understanding of your parents’ financial situation, it is time for a sit-down chat to discuss their financial goals and wishes. We suggest going over the following:

• What is their preferred retirement lifestyle? (e.g., aging in place, moving to a retirement community, relocating closer to family), and what type of activities or hobbies they wish to pursue.
• Do they have any debts? (e.g., will their retirement income cover paying off debt, and how will it affect their financial situation?)
• What is their legacy plan? (e.g., are their estate planning documents up to date, and who will be their executor?).
• What are their wishes for healthcare? (e.g., expectations and plans for managing healthcare needs, long-term care preferences, etc.)
• How do they wish to address end-of-life care? (e.g., do they want medical intervention, hospice, etc.)

Additionally, we recommend discussing how you can transition into their financial situation to support them. For example, could you start automating monthly expense payments so that nothing is ever missed? Could you have monthly or quarterly financial dates together to discuss how things are going or if something has changed? Could you check in on their bank accounts to make sure no fraudulent charges are made without them knowing?

Of course, if you don’t think this is a conversation you can have with your parents, you can always request a financial mediator, such as their investment manager, to be present to lead the discussion.

Managing Parents’ Retirement Together

At Retirement Watch, we understand that making this transition can be overwhelming. Not only are you taking on sensitive aspects of your beloved parents’ lives, but you are also likely to encounter financial elements that you have yet to be exposed to.

We at Retirement Watch welcome families to come together for retirement planning. We will happily guide the conversation, help you ask the tough questions, and address any concerns you may have. Don’t wait – book your free consultation with us today!