Do you have an estate plan?
This question may be difficult to ask but it’s important to have this discussion. This includes documents like a will, trust, health care directives, and other important legal documents. If they don’t have these documents, they need to speak with an estate planning attorney.
If your parents didn’t have wills or estate planning documents, decisions on how to distribute their assets could go to probate court. Probate can be a long, stressful, and expensive process that can be avoided by planning ahead.
How will you handle healthcare expenses?
Healthcare costs are some of the most expensive costs in retirement. Medical bills can eat up your retirement budget if you don’t plan accordingly. If your parents have not retired yet, you can help them find ways to plan for health care expenses by reviewing the type of government benefits they may receive or by opening an HSA account if they don’t have one already.
You might want to also ask if they have considered long term care insurance. Cost of assisted living is more than $3,600 per month on average and cost of a private room in a nursing home is more than $7,000 per month. If your family isn’t in a position to cover the costs should they need 24/7 care, long-term care insurance would be worth looking into.
Where do you keep important documents?
Knowing where your parents keep important documents is crucial. Having all the paperwork organized and in a safe place will make stressful scenarios easier. It could be possible your parents have it in a safety deposit box that you would have never known about if you didn’t ask.
Is your information updated?
Are your beneficiaries up to date? Is your will current? Some people believe they have these in place but haven’t updated them in years. It could be affected by any change in family circumstance, like a birth of a new child, marriage, or even a divorce.
What is your retirement plan?
Your parents are probably looking forward to retirement and this may be an easier conversation. But being the child, it’s important to know if they have a retirement plan in place and have worked with a trusted financial professional. It’s better to have this discussion now then in 20 years when you and your siblings have to decide who’s house Mom and Dad will live at permanently.
Do your parents have a pension? Do they have enough money in their brokerage accounts, IRAs, real estate etc? Are they depending on Social Security? These are some of the questions that need to be reviewed when building a retirement plan.
If you want to set up a time to discuss how to ask these questions or want us to help review your situation, please reach out to us at 847-550-6100 or george@pmgwealth.com.
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.
