How to Help Your Parents Financially Without Breaking the Bank

According to the U.S. Census Bureau, every member of the Baby Boomer generation will be 65 years or older by 2030. Because of this, the healthcare system in the country is seeing a boom right now, and businesses are seeing a shift in their employees as many older individuals are retiring at once.

As the Baby Boomer generation continues to age and retire, there are certain possibilities to consider. If your parents are a part of that generation and are struggling financially, you might feel as though you need to help. Or, if your parents are chronically ill or unable to take care of themselves, you might be tasked with being their Power of Attorney, in which case it’s up to you to make decisions for them.

Taking care of your aging parents’ finances can be overwhelming, especially if you’re trying to raise your own family. If it’s not done the right way, it can cause a lot of discord and frustration. With that said, what can you do to help your parents financially, without putting your own finances in jeopardy?

Practical Ways to Help Your Parents

If your parents need financial help, it’s easy to feel stressed by it, especially if you’re taking it on by yourself. It’s normal to want to help your parents and do everything you can to keep them secure, especially if they want to remain in their own home and continue the lifestyle they’re used to.

There are practical things you should do as you consider helping your parents, but it starts by working out a few things before you commit to any financial decisions. Keep the following tips in mind to help you come up with practical solutions:

  • Seek professional advice from a financial advisor
  • Have a family meeting
  • Consider any long-term consequences
  • Talk about the sacrifices everyone may have to make
  • Understand it’s okay to say “no” about some things

One of the best ways to help your parents with their finances is to plan ahead as much as possible and to be as honest and open about the situation as you can. That includes being honest about how you can and cannot help and asking others for assistance along the way.

With that in mind, helping your parents with their finances doesn’t always have to mean giving them money. You could oversee their bank accounts and spending habits, help them to create a budget, or go with them to see an estate planning lawyer.

Dealing With Medical Expenses

As people age, their chance of developing a chronic health condition increases. If your parents already have a lot of outstanding medical debt, one of the best things you can do to help their financial situation is to see if you can get it settled. This can be done by applying for medical debt forgiveness. There are charities throughout the country that assist people who can’t afford their medical bills by “buying” away their debt. Do your research and check your parents’ eligibility for these various charities to see how they might be able to help.

If your parents do develop a chronic condition or healthcare issue in the future, bills can start to add up quickly. Some of the most common ailments older individuals face include things like dementia or Alzheimer’s, diabetes, and heart conditions. 

Not only can those issues require a lot of treatment, but they may even require your parent to move in with you or to an assisted care facility. They may even need to consider in-home care, which can be expensive as well. Your parent(s) also may not immediately be thrilled about the idea of moving to a facility or having someone come into their home, so be patient with these ideas, but consider the long-term implications of not getting help. Sometimes, the need for medical attention outweighs what it might cost, or what they really want.

If your parents have some type of medical insurance, look at what it covers before considering any time of extra care. Looking over their plan can make it easier to come up with the best long-term health decisions for them.

Helping Your Parents Plan Ahead

If your parents aren’t yet at retirement age or they are still vibrant and active, it could be time to sit down and talk with them about their plans for the future. Do they have a retirement plan? How long do they intend to keep working? What are their financial goals before they retire?

It might seem a bit uncomfortable at first, talking about money with your parents. But, it’s a good way to help them before they might actually need it. Just because they are your parents doesn’t mean they may not have financial struggles or worries. Talking about their financial situation now can help you both later.

If your parents are concerned about their retirement years and aren’t sure how they are going to afford the cost of living, work with them to improve their finances, and save money. There are plenty of ways to put a financial plan into practice, including:

  • Setting realistic goals
  • Turning a hobby into a side job
  • Starting an emergency fund
  • Sticking to a budget
  • Boosting credit scores

Your parents may not be willing to approach you and ask for help. This isn’t uncommon with older individuals. They may be embarrassed about their need for assistance, or they may be too prideful. So, if you have concerns about their financial future, don’t be afraid to take the first step and approach them about it.

By helping your parents plan things, you will have a better idea of what to expect when they retire, and you can find comfort in knowing they will be taken care of without taking the brunt of their financial burdens.

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