Do your aging parents need financial help?
It’s a strange place to be as a son or daughter because life is coming full circle. No longer are your parents taking care of you. Instead, it’s time to return the favor.
Beyond that, you have your own expenses to manage, which might include your own children, car payments, mortgages, rents, and all manners of insurance.
Are you worried about this new challenge? Don’t sweat it–just read the rest of this blog for three tips to help your parents financially:
Tip #1: Help First. Pay Second.
Are you like the bulk of Americans who have aging parents?
If so, you’re in a precarious financial position at this stage in your life. You need to make sure your actions are towards financial stability.
You could even be doing okay money-wise, but who knows what tomorrow will bring? Very few people in this world have unlimited funds at their disposal.
So, if you can help your parents while protecting your savings, why not take that option?
One way to be there for your parents without lending them money is to guide them through a downsizing process. You’ll need to be hands-on and take a leadership approach.
With the above notion in mind, Fidelity.com highlights the three most important factors you must consider when helping your parents downsize:
- Location significantly impacts finances and lifestyle.
- A home dictates taxes, insurance, utilities, and maintenance costs.
- Crafting a financial plan will help with finding the right house.
The Balance suggests offering your aging parents the option of moving into your place if you have the space. You should also help them make a budget. You can save up by avoiding unnecessary expenses.
Lastly, if you’re handy, do repairs and maintenance on your parents’ car or in their home.
Tip #2: Transparency is a Must, So You Can Plan.
According to Money Under 30, most millennials who help their parents financially are putting themselves at risk to do so. Furthermore, over half of those people don’t ask why their parents need help. Nor do they know where the money is going.
These arrangements function best when you know where the money is going and whether it will be repaid. Specifics are a must.
Additionally, find out how each family member can assist with your parents’ quality of life.
From there, it’s possible to plan and budget based on the information you’ve been given.
For instance, it’s better to know your parents can’t pay you back, because you can adjust your lifestyle accordingly.
Tip #3: Protect Yourself from Toxic Situations
You’ll always feel a sense of obligation when your parents are in need.
Potential guilt aside, if you can’t afford to give your parents money, that’s just a cold hard fact. As this article already discussed, there are ways to help without lending or giving away money.
Essentially, if your parents have been financially irresponsible and keep coming to you for money, that’s toxic behavior.
While you can still help in various ways (namely, taking charge of your parent’s finances and coaching them), you aren’t responsible for their mistakes. Your money is yours. Helping out when you deem it necessary is one thing. But you’re under no obligation to fork over your life savings.
Rest easy and pull out your calculators. You can now put your best foot forward with these 3 tips to help your parents financially.