November 2024
Welcome to this month’s Ask the CFP® segment.
As a financial advisor, clients often express concern about helping manage their aging parents’ or relative’s finances. We have put together some tips to help approach this delicate conversation with sensitivity and respect.
First and foremost, choose the right moment to broach the topic. Find a time when your parents are relaxed and receptive. Avoid bringing it up during stressful situations or in front of other people.
We suggest beginning the conversation with empathy and understanding while acknowledging that it can be uncomfortable to talk about money and the challenges that may arise as your parents age. Try to emphasize that you’re available to help with the leg work and be a sounding board for their financial well-being.
Listen closely to your parents’ concerns and priorities. Ask open-ended questions to understand their financial goals, challenges, and values – remember, they may have different priorities than you. This helps show your respect for their autonomy while helping you tailor your assistance to their specific needs.
Once you have a better understanding of your family members’ financial situation, offer your support in a non-threatening, non-judgmental way. Instead of taking over control, suggest ways you can work together to manage their money and investments. If your parents have not yet completed a financial power of attorney document, now is the time. This power does not require your parents be incapacitated and doesn’t take away their ability to make financial decisions…but it does allow the people they choose to help pay their bills and manage their finances.
Above all, focus on simplifying your parents’ or relative’s finances and reducing any unnecessary risks. Offer to help organize their paperwork, set up automatic bill payments, or review their investment portfolio for diversification and stability. Reassure your parents that your goal is to ease their burden and ensure their financial security for the long term.
Don’t forget to ask your parents to introduce you to their financial advisor. Use this opportunity to understand the financial plans that are in place and to clarify your role in assisting your parents to accomplish their priorities.
Talking to aging family members about managing their money and investments can be challenging, but with patience, empathy, and open communication, you can navigate this sensitive topic together and help everyone achieve peace of mind.
If you have a question for a future ask the CFP® segment, please send it to mgolaris@monetagroup.com
Thanks for watching and we’ll see you next time.
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© 2024 Advisory services offered by Moneta Group Investment Advisors, LLC, (“MGIA”) an investment adviser registered with the Securities and Exchange Commission (“SEC”). MGIA is a wholly owned subsidiary of Moneta Group, LLC. Registration as an investment advisor does not imply a certain level of skill or training. The information contained herein is for informational purposes only, is not intended to be comprehensive or exclusive, and is based on materials deemed reliable, but the accuracy of which has not been verified.
