Talk to Your Children About Your Retirement Plans

It is Best for You and Your Children's Health, Wealth, Well Being

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Too emotional!


These are the words that many people – both seniors and the adult children of seniors – use to describe discussions about retirement, long term care and end-of-life issues.

This is probably no surprise. Money, illness and death are among the most difficult topics to discuss, especially when intertwined with complex family dynamics and competing priorities. As such, some studies show that only one out of three families has discussed issues surrounding retirement.

Why it is VITAL to have this Discussion About Retirement with Family Members!

While it may be incredibly difficult, if you are lucky enough to have family, it is very important to discuss your retirement plans with them.

You may believe that you will retain complete independence for the rest of your life, but the reality is quite different for at least 40 percent of today’s families.

  • The National Alliance for Caregiving and the American Association of Retired Persons (AARP) estimate that 22.4 million U.S. households – nearly one in four – are now providing care to a relative or friend.
  • FORTY percent of baby boomers who have a living parent are helping take care of that parent – either financially, personally or both.
  • Of the boomers who are not yet providing care for their parents, THIRTY FIVE percent think that they will be doing so in the future
  • And, with longevity steadily increasing, it is likely that these percentages will be GREATER in the future.

How do you know which percentage your family will fall into? How can you guarantee if you’ll be able to retain your independence or not?

The reality is that there is NO WAY to know!

As much as you may want to avoid being any kind of burden on your family, as much as you may want to retain your own independence, you have no way of knowing what will happen.

  • Lack of thorough financial planning or an unforeseen circumstance may hamper your ability to pay for retirement.
  • And even if you are financially prepared, what happens if you lose cognitive functions or the ability to physically care for yourself?

This conversation is VITAL. There is a strong likelihood that you will rely on your loved ones for care, financial help and/or the fulfillment of your wishes as you age.

Further Evidence of the Importance of Discussing Retirement with Your Family Members

If you are not yet completely convinced that discussing retirement with your family is worth the difficulty of doing so, consider the following benefits of an open conversation about your retirement:

  • You can help avoid confusion, hard feelings and family squabbles by having as frank of a discussion as possible about everyone’s expectations and abilities
  • Discussing your retirement as early as possible gives everyone the opportunity to avoid having to react in a stressful emergency situation where you may or may not be able to express your own wishes
  • A discussion at or before your retirement could enable you to improve your plans for the benefit of the whole family
  • Your financial situation can impact your children’s finances in both positive and negative ways; there may be things your adult children can or should do now to improve preparations:
    • An advance discussion gives siblings the opportunity to plan how they can work together to help you.
    • Family members may want to alter or consider their own housing situation to make it suitable for living together if applicable
    • Other adjustments might be made
  • The discussion can be a good sanity check for your retirement plans to insure that you are as financially prepared as you think you are
  • Family members may be in a position to help you financially now in ways that better preserve your – as well as their own – overall wealth. It may be a financial win-win for both you and your children if family members want to:
    • Pay your mortgage payments for you rather than having you get a Reverse Mortgage – which may or may not retain wealth in the family. (This can even be done as a business transaction so that the contributing children are officially buying equity in the home. It can also be done unofficially.)
    • Purchase Long Term Care insurance for you to help fund long term care costs should they arise
    • Purchase a Lifetime Annuity for you in the case you need additional lifetime income
  • If necessary, children can help research your options and assess your eligibility for Medicaid or other programs.