Communication problems between parents and children don’t automatically disappear once the latter reaches adulthood—especially when it comes to issues such as elder care and retirement planning.
In fact, the only thing both parties seem to agree on is that they would rather talk about finances with a third-party acquaintance than with one another.
Sixty-eight percent of parents and 60 percent of adult children preferred discussing money with a financial professional over their family members, according to a recent survey conducted by Fidelity Investments.
What makes money such a taboo topic?
Many adult children (40 percent) appear hesitant to bring up the issue of their aging parents’ financial situation because they feel that it is none of their business.
Fifteen percent of aging parents agree that the state of their assets should remain private, but many also avoid talking about money because they don’t want their offspring to rely too much on their future inheritance (30 percent).
Despite the discomfort of discussing a parent’s dough, the fact remains that proper financial planning requires people who are nearing retirement age to have an open dialogue with their children.
Honesty eases worries and clears confusion
Planning for the future can offer adult children and their parents a sense of serenity in an uncertain economy.
Older adults reported that having frank conversations about retirement, elder care issues and estate planning with their children helped them gain a better peace of mind as they approached retirement.
Too many families, when they do talk about financial needs in retirement, engage in incomplete, shallow dialogue.
The survey indicated that parents and their children disagreed on a variety of issues, including a parent’s attitude towards retirement and what kind of lifestyle they expected to have. Many older adults have some kind of financial strategy in place for the future, but they often fail to let their offspring in on the details of their plan.
This could explain why some adult children (24 percent) expect to have to provide financial support to their parents in retirement, while the majority of older adults (97 percent) feel that they will be fine on their own.
Why you need to have “the talk”
Money may be an uncomfortable topic, but honest discussions between parents and adult children about retirement and financial planning are essential.
Such conversations are far more likely to occur when parents and adult children believe that the other party is open to having an honest dialogue.
“With parents living longer and the increasing financial complexity that the sandwich generation faces, it’s critical that families break down barriers, have these important conversations to make informed decisions and take control of their finances, rather than reacting to a crisis,” Kathleen Murphy, president of Personal Investing at Fidelity says in a press release.
How to Find a Good Financial Advisor
Financial Planning Strategies for Baby Boomers and Their Parents
How to Discuss Money With Your Parents
19 Free Services for Seniors and Their Caregivers
10 Things You Should Know About Your Parents’ Finances
The Biggest Mistake People Make When Filing for Social Security
By Anne-Marie Botek, AgingCare.com Editor