The Conversation About Finances Between Adult Children and Aging Parents

The issue of how much detail parents should tell adult children about their finances is a complex one. All sorts of factors come into play, from the practical to the hot button issues of family dynamics. Every situation is different and there is no boilerplate right answer. The scenarios below are meant to be representative of ones I have experienced in my practice.

John and Mary have always lived well and that has continued into retirement. Their children assume that they have a substantial amount of money and therefore think nothing of coming to them for help. The reality of their finances is that they have always lived right up to the edge – and at times beyond. They aren’t sure how to begin to correct this illusion and change habit patterns.

Eva is widowed and living on a fixed income. She’s proud and very independent. Recently she realized that it was time to stop driving so she hired a woman to drive her when needed. As more and more of her friends have stopped driving, she has had to begin using the driver more frequently. The cost of this is starting to have an impact on her finances but none of her family lives in the area to help out. She doesn’t want to ask for her children for help so she’s staying home alone more often instead.

Dave and Anne were financially very comfortable, not rich but very comfortable and very private about how much money they had. Their son-in-law has never made much money and never seemed very ambitious. Dave just passed away and now Anne is working through things such as Power of Attorney, signatory authority on her accounts, access to the safe deposit box, etc. She’s uncomfortable having her son-in-law know how much money she has but knows that her daughter is the logical choice for these responsibilities.

Adult children as well as their aging parents may be uncomfortable initiating or being involved in conversations about topics that haven’t been discussed before. But, it is important to have the conversation and develop a plan before a crisis or emergency occurs.