At some point, you’ll need to have “the talk” with your parents about their finances and their financial future. Retirement planning in Canada is the only way for them to keep their financial future on a solid foundation and for you to prepare yourself to provide the help they might need as they grow older.
Helping your parents make a retirement plan is about their needs, not yours, and retirement planning is not always an easy discussion to have. Parents may see your attempt to discuss their retirement plans as an intrusion – especially in families where talking about money is taboo. They may even fear that you’re trying to take control of their money. But it’s important because one or both of your parents may become ill or incapacitated and unable to manage their finances in the future.
In addition, the health care in Ontario leaves much to be desired and so if your parents want to retire in comfort, a strong retirement plan will be key. Retirement planning in Canada could consider their life insurance needs, long term care planning, critical illness coverage and more. It all depends on your parent’s health, financial circumstances and future desires.
They should be aware that without thoughtful planning, how they are cared for at that time could be entirely out of their control. It’s about their needs, their comfort and how they want to be cared for.
Don’t wait for a crisis. Talking to your parents and planning ahead for their retirement will help make sure their wishes are carried out, and potentially eliminate squabbles among family members if your parent’s wishes aren’t clear.
Retirement planning in Canada is really important and helping your parents see the benefits when making their retirement plans can make the conversation much easier.
You can avoid problems and alleviate worries concerning their retirement planning by showing your parents the benefits of sharing their financial information. Let them know that it will be easier for you to help them in the future if you have the information now. Stress that it’s important for them and their family, financially and emotionally. Some discussion points when discussing retirement planning in Canada include:
• Do your parents have up-to-date wills? If so, where are they kept?
• Do they each have powers of attorney (both for property and health care)?
• Who are the executors in their wills, and has this decision been reviewed lately?
• Will they have enough funds to continue living comfortably? To plan, they need to provide details of assets, liabilities, income and expenses, and details of financial accounts — or at least where accounts are held. As well, contact information for financial and legal advisors is necessary.
Don’t be afraid to seek expert advice. We can prepare you for a talk with your parents about finances. And if it will help, we can be part of the discussion.