15 Things Gen X Needs To Ask Their Aging Parents About Their Finances

The U.S. Census Bureau estimates that in 2020, about 2.4 million parents received over $2,000 annually from their adult children, with an annual mean payment of over $3,700.

If you’re a Gen Xer, you may feel it's time to break through the wall to discuss their financial obstacles, needs, and goals, even as you’re also planning for retirement.

Here’s what you need to know and how to go about asking to ensure you can help your family members make the best decisions for their needs.

This includes more than just the knickknacks in the home. You also need to know about investment accounts, pensions, retirement accounts, real estate, and other holdings.

Ask your parents about their money. You should know what they have, including retirement accounts, life insurance, and safe deposit boxes. It’s important to know which financial institutions those accounts are in, too.

The next step is to explore their debt, including mortgages, credit cards, medical bills, and other financial obligations.

When speaking to your family members about these debts, make it clear that you want to get a clear picture of how their debts will impact their finances over the long term. 

You can also check how they can save money on utilities and other expenses like auto insurance coverage or subscriptions they are paying for but may not use.

Being able to make decisions for your aging parents if they are ill or become unable to communicate their needs is critical. A simple illness could mean their mortgage goes unpaid if no one else can access their accounts.

For this reason, it's critical to have the paperwork in place to make financial transactions for them. 

You’ll need to work with your family member to find the balance of trust here, but at the most basic level, being a joint account holder can be helpful, though having power of attorney may be better.

You have some insight into expenses and income now, but you may not have a full idea of how they spend their money. In fact, they may not have a written budget at all.

Talk to your family members about their income, ways to avoid wasting money, and how much they should target to save each month going forward. 

This type of frank, open conversation can help your parents have better control over their financial future.

You should have some understanding of what happens when there’s a leak in the roof, or the car needs to be repaired. That means you will need to know if your parents have an emergency savings account or lack one.

Typically, this should be an account that’s easy to access and has about three months of expenses available, though longer is better. Discuss the availability of such accounts and the benefits of setting one up now, especially with you as a joint account holder.

You also need to have a solid understanding of their health care, including what type of insurance they have (Medicare, Medicaid, supplemental, Medigap, and others). 

Verify how they get care, such as who their primary care professionals are, which hospitals they can visit in their plan, and where they can get prescriptions filled.

Ask your family member to discuss the potential for the future now, too. If they need to go to a skilled nursing facility for some time, do they have long-term care insurance available to help with the cost?

Do your parents currently have a financial advisor they turn to? This could be someone at the bank or credit union or a Certified Financial Planner. 

They may have a tax professional they’ve used for years, too. Knowing who these people are can help you in a financial crisis.

Ask for their names and contact information, even if your parents haven’t made changes to these accounts in years. That’s not uncommon, and it could mean that there's room for improvement. Ask your parents to let you work with these professionals to get your accounts in order.

It’s can difficult to have these conversations, but you need to know what your family member’s wishes are for their future, including after their death. 

Do they already have a trust, a will, an advanced directive, or other documents? Do they want to create them now?

This can be a delicate situation for some parents, and that often means having this conversation with their attorney. 

You don’t have to know the details of their will if they don’t want you to, but they should have updated it, you should know which attorney holds it, and you should know who the administrator or executor is.

Are your parents still paying bills by writing checks, or must they go into each one of their accounts to make those payments? Setting up auto-pay will help them avoid missing payments down the road.

Discuss this with your family members as a simple way to keep making payments on time and without fail. There’s typically no cost to doing so. You can also have statements come to you if your parent agrees so that you can ensure bills are being paid appropriately.

Another very important conversation to have is about the technology they could use to help protect their identity. 

There are several steps to take here, starting with establishing their “my Social Security” account. Consider the value of credit and identity monitoring services, too.

Talk to your parents about the risks to seniors, too, including the common phone scams that can seem so real that anyone could fall for them.

If your parent’s finances are under control, you don’t want someone to cause havoc by using your parent as a co-signer or tapping into their personal information to secure a loan. Freezing credit reports is one way to do that.

Explain to your parent the importance of protecting their financial information here, especially keeping would-be thieves from accessing their credit report.

Have an open and frank conversation with your parents about whom they wish to help them from time to time. Would they prefer one sibling over another? Is there a trusted neighbor who could help in an emergency?

The most important thing is having a point person handle bills and health care expenses. Others, such as your siblings, may want to have this knowledge too, but one person should be in charge. 

Explain the importance that a simple mistake, like double paying a bill, can have on their budget.

Heated family arguments often stem from money issues, even in the best of families. One way to prevent this is never to combine your finances with your parents.

Keep separate accounts and document everything. Ensure you have receipts and statements to verify any details so you can't be accused of financial abuse.

As your parents age and wish to stay at home longer, the need for in-home help becomes stronger. Yet, this opens the door for people you do not know to enter your parent’s life.

Discuss with your parent how safe they feel and keep the lines of communication open between you and a caregiver. If you suspect any type of abuse or theft, find someone new. The key here is to make sure your presence is known.

Not all seniors can create and stick with a budget or count on retirement income from savings accounts. There are local and national programs that can help them.

Look into support from the National Council on Aging, Volunteers of America, and local programs.

It’s not easy to have these conversations, but for children who want to ensure their parents are cared for and their money lasts, this is critical. 

They may be doing better financially now, but a downturn in the economy can change their situation quickly.

Discuss your parents’ financial situation, and be sure to focus on what their real needs and desires are, not just what you think they should do.