Table of Contents Explore the findings of our eleventh national survey. Elderly people running out of money is an unfortunate trend. Nearly half (49%) of Americans ages 55 to 66 have no retirement savings. In addition, women tend to have less savings than men.1 That lack of savings may be causing an increasing number of aging parents to move to live with their adult children. Older Americans are less likely to live alone than they were decades ago, and some are now living with their children.2 While living together can provide financial help to aging parents, it can add stress to the child becoming a caregiver and also put older parents in a difficult situation.
Intervening to help your aging parents better manage their finances will not only help them, but it can also help you protect your finances. This is because many states have filial liability laws that legally require the adult child of an impoverished parent to pay for parental needs, including long-term care, as well as debts, 3 (it's always a good idea to seek advice from an attorney or other qualified legal professional about your particular situation). If they can't afford the extra coverage and don't have savings to pay for home care, they can consider Medicaid. This can be an attractive option if your parents live alone.
The most important step in helping your parents overcome financial difficulties is communication. Figuring out how to make “money talk” as they age can be difficult. Even under ideal circumstances, sharing financial information creates a sense of vulnerability. But when you add difficulties or debts, it's hard to talk openly.
The day may come when your parents can no longer handle their own financial responsibilities and find it difficult to ask for help even if they need it. However, if you take a sensitive approach, you can work with your parents gradually and make the process as comfortable as possible. Here are eight steps you can take to manage the finances of your parents or loved ones. Once you've decided to help your aging parents, take advantage of the additional resources available that can help. Meals on Wheels has a national network of local branches, but there are similar services that might be more suitable for your parents.
Helping aging parents can be a challenge, especially if they have financial and health care problems or if they make poor decisions with their money. The eligibility requirements and the amount of services available through Medicaid depend on the state in which your parents live. More than half of adults (55%) believe they have a great responsibility or a significant amount of responsibility when providing financial assistance to an aging parent. By exercising a power of attorney with your parents, you ensure that you have the legal authority to make important decisions when your parents are unable to do so. If two or more siblings are willing to help, you can offer more help to your parents, support each other throughout the process, and hopefully avoid feelings of resentment.
If you participate before your parents run out of money completely, you can help influence the final outcome. Knowing the warning signs, such as confusion about a financial situation, unpaid bills or collection notices, and unusual withdrawals or payments, can help protect your aging parents from being victims. Helping your aging parents manage their money could mean controlling expenses more carefully so that the cost of their retirement doesn't affect your future. I've spoken to dozens of adults who grew up with or are still coexisting with financially unstable parents.
If you suspect that your older parents are running out of money or are making imprudent financial decisions, don't wait any longer to intervene. Talking to your parents about their finances, their health and their wishes for the end of life is uncomfortable for many. If you're willing and able to provide financial support to your parents, and you're not worried that you're eligible for government help, you may want to look for financial solutions that can help provide regular cash flow quickly. This is because many states have filial liability laws that legally require an adult child of an impoverished parent to pay for parental needs, including long-term care, as well as debts.
While you may want to provide financial help to your aging parents, talking about these issues can help prove difficult.
