Critical financial decisions to discuss with your parents when they move in with you
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Having your parents around can be exciting as you get to spend more time together. They also bond with the grandchildren, and it’s almost like having a family reunion every day. If they’ve been sickly, it’s a relief having them around because you can take care and give them the attention they need. Living together simplifies things, but there are critical issues you should address.
Insurance
As difficult as it is to talk about your parents’ death, it’s essential to put the right measures in place. The most critical one is life insurance. Do your parents have a policy such as the whole life insurance policy? Dealing with funeral expenses, debts, and medical bills can be draining, but the benefits can significantly ease the financial strain if you have a life insurance policy. If your parents don’t have a life cover, talk to your insurance provider and get to know the available options.
Bills and Everyday Expenses
Having additional family members increases the expenses. Consider the direct and indirect costs of the move. You will have to buy more groceries, take care of the doctors’ trips, and any other need they have. If they have a special diet, it means preparing different meals which will use more energy. Your parents may also want their room warm all the time, which will increase the electricity bill. Take note of all the extra expenses and discuss the expected changes to your monthly budget.
You could ask your parents to take care of some of the expenses, get some financial help from other siblings, or meet all the bills. Note that whatever decision you make now will be hard to change later on. If you decide to take care of all the expenses, make sure you have the required finances to support the decision even if you lose your income.
Probably, your parents still have a source of income such as retirement savings, investments, social security, annuities and pensions. They can use the earnings to offset some expenses, but how do you convince them? If you can’t, raise the issue on your own, get a financial advisor who will help you figure out how much everyone should contribute.
Your Parents’ Expenses
You may want to check whether all their bills are getting paid and their finances are in order. Also, check if they have debts and how they intend to distribute their estate. Finding out about your parents’ debt will help you take the necessary action before auctioneers or creditors take over their property. Additionally, bills can pile up, leading to more financial stress. Helping your parents plan for their estate ensures that everything is in order when they finally rest. If you have other siblings, they too will want to know how the estate will be divided. It’s much easier to do it when your parents are still alive.
Having financial conversations with your parents when they move in will ease the strain as expenditure goes up.
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