Planning ahead – tips to help older relatives build solid financial foundations
Planning ahead is beneficial at any stage in life, but it’s particularly important to think about your financial future as you approach retirement and your senior years. If you’re helping your parents or other older relatives to build solid financial foundations, here are some useful tips.
Retirement planning and pensions
Most of us work for several years before deciding to retire, usually in our mid-60s. If you have older relatives, it’s hugely important to discuss retirement with them and to make sure they have plans in place to cover bills and lead a fulfilling life once their monthly pay cheques come to an end. Many people have a pension through their job, and some will also have private savings accounts. As your relatives get older, it may be worthwhile discussing how they plan to use their money and what they want to spend their money on so that you can help them to keep track of spending, budget and manage their money effectively. It can also be useful to have an open chat if your parents aren’t in good health, and there’s a risk that they will need care.
Nobody wants to have a conversation with their partner or parent about what will happen when they are no longer here, but sadly, death is a reality we all face. It’s common to take out a life insurance policy when you buy a house, you get married or you have children, and many people will have been paying for a policy for several decades by the time they reach their senior years. Life insurance provides a payout, which can be used to cover the cost of funerals, pay outstanding bills and support loved ones when the policyholder passes away. It’s important that the individual specifies who they wish to inherit their life insurance payout, and it’s beneficial to talk about costs like funeral fees and arrangements with your family members. Some people pay into separate schemes to provide financial assistance towards funeral costs.
Investing and saving
If you have money in savings accounts or investments as you get older and pass retirement age, it’s a good idea to think about whether you want to keep hold of your investments, whether you want to pass them on to family members, or whether you’re keen to include them in your estate. If you’re taking care of an older relative’s finances, it’s useful to talk to them about their accounts and investments and determine what they want to do in the future. If they want to sell assets, for example, they may have a timeframe in mind, and they may need to seek legal advice to adjust or update a will.
Many of us have concerns about our relatives being subjected to scams or security threats. Sadly, there are people out there who target the vulnerable. It’s always wise to ensure that accounts are protected and to try and chat to your parents about signs to look out for so that they can spot scams and keep their money safe. You can also look into measures like call blocking and installing phishing filters for email accounts to reduce risks. Encourage your senior relatives to get in touch with you or to seek advice if they get any suspicious calls, texts or emails and make sure they know not to divulge sensitive information, such as account details, over the phone or in person to somebody who knocks at the door.
Building solid financial foundations is crucial for older people who want to enjoy their retirement and prepare for the future. If you’re caring for your relatives, or you’ve taken over their finances to ease pressure, we hope this guide will prove helpful.
Image source: https://pixabay.com/photos/senior-elderly-people-couple-3336451/