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Accounting for Aging Parents in Your Early Retirement Plans

When we talk about how to retire early, and how much we need to save, we often only talk about how much our own needs and wants will cost. But of course that’s an incomplete answer. For nearly all of us, there are other people in our lives who may need to factor into our plans in some way, both directly and indirectly.

For a large majority of adults, there are kids to consider. All their costs while growing up, then maybe the costs of college and of getting set up on their own afterward. While kids don’t have to be as expensive as the statistics tell us, they never cost nothing. And parents and caregivers need to account for that. That’s a conversation that happens often in the early retirement community, because for those of child-bearing age or those who are already parents, the costs are right in front of your face, right now. Or they will be soon.

But there’s another important set of people you may want (or need) to account for in your planning, ones whose financial, emotional and logistical needs may not be top-of-mind right now: your parents.

So let’s talk about them!

Related post: What’s Our Money Really For? // There’s More to Life Than Future Goals

aging-parents

There are as many different sets of family circumstances as there are families, so you know what applies to your situation and what doesn’t. But even speaking abstractly, aging parents or other loved ones aren’t a frequent topic of conversation for most of us.

Leigh tweet

I’ve shared before that my dad is disabled, and retired early in his 40s as a result of that. But I haven’t said much more than that, because it’s his story to tell, not mine. Which is great for his privacy, but not great for this much-needed discussion. So today, I’ll try to share as much as I can about our parents and how we’re thinking about this stuff without sharing too much, as well as add more general info about how you can and should incorporate aging parents into your plans. For added context, Mark’s dad also retired early, in his 50s, Mark’s mom stayed home after the kids came along, so is also “retired,” and my mom is still working.

Retiring Before a Parent

Though the actual average retirement age remains right around 62, most people nearing retirement say that they plan to work much longer than that. For those who actually have the option to do that – that is, they aren’t too sick or forced to retire to care for a loved one – you might find yourself in the position of retiring before a parent if you retire early enough. I did with my mom. This isn’t something to plan for as much as something to be aware of, but than can be a tricky thing to navigate in a relationship. The still-working parent might be completely thrilled for you but also feel a whole host of negative emotions about what it says about them. Do your best to be sensitive to what they might be feeling while reminding yourself that they are, in fact, happy for you. I find myself needing to do this with mom because, understandably, she is not thrilled to be stuck at work for the foreseeable future. But that’s her situation and not mine.

Parents Who Aren’t Financially Prepared for Retirement

The first real obstacle you may need to consider is a parent or multiple parents who aren’t financially prepared for retirement or other financial events. Currently, 65 percent of retirees rely on Social Security for more than half of their income, and given that the average monthly benefit is in the neighborhood of $1500, we’re talking about a lot of seniors who are scraping by or doing only slightly better. And that’s before you talk about the figure that keeps creeping up: the cost of medical expenses that the average retiree can expect to pay for from the time they get on Medicare until the end of life, currently at $280,000 or so. That’s why Kaiser Family Foundation projects that Medicare beneficiaries will spend half of their Social Security benefits on out-of-pocket Medicare costs by 2030, a figure that already stands at 41 percent currently. It’s even more for those 85 and over, those in poor health and those with modest or low incomes.

And so it’s not unimaginable that you may have a parent or more than one parent who is not prepared financially for their non-working years, and that you may need to do some thinking about when and under what circumstances you’d step in. You’re under no obligation, after all, to completely support a parent who’s in a bad financial position entirely because of their own choices, but you may also recognize that the lack of preparation for retirement might be due to things beyond their control, and you may wish to help in some way.

Some of those ways you can help might be offering to help them move to a cheaper living situation or to a cheaper part of the country (or near you), offering to teach them strategies for spending less in problematic categories, helping them negotiate lower bills, or perhaps something bigger like letting them move in with you, buying a rental property to rent to them so that you can prevent the monthly rent from creeping up or even providing direct financial support. Or you might choose to pay for services that they need but can’t afford, like housecleaning, in-home assistance, etc.

It’s worth considering which of those options, or others that apply to your situation, you might offer, and what it would take for you to offer more. Then take a close look at your financial plan and make sure you could withstand the financial hit for a number of years. If you can’t, consider bumping up your targets to make room to help. And consider the emotions that are likely to go along with some of these choices as well. Parents forced to admit they need help from their kids may feel infantilized. You may feel resentful that you’ve been put in the position of having to help. All of that’s valid, but the more you can mentally prepare yourself in advance, the more you can manage those emotions.

We’ve gone into several financial arrangements with family – namely making a sizeable personal loan and buying our rental property expressly to rent to a loved one – and while I wouldn’t recommend mixing family and money in every instance, if you think that particular relationship can handle financial entanglement, a good option is to create an arrangement that is mutually beneficial, like making a loan that pays you interest, or buying a rental property that will be profitable long term but also helps the person in need save money and gain security. Fortunately in our case, we made both of those arrangements while we were still saving, so they didn’t force us to massively reconfigure our retirement finances. But if those needs arose today, we’d still try hard to help.

Related post: Choosing People Over Money // The Story of Our Rental Property

Related post: Why We Ignored The Experts and Loaned Money to Family

We’re hugely thankful, though, that three out of our four parents have military or VA health care for life, on top of their Medicare, meaning they are unlikely to face medical bills they can’t afford, or – worse – turn down needed care because of financial worries. We thank our lucky stars that we only have one parent out of four who may face the medical financial stress that impacts so many seniors.

Providing Non-Financial Care

As parents get older and slow down, there are any number of other types of support they might need: social interaction to counter age-related isolation, help getting around, help keeping their home in order, help navigating the health care system and making decisions in their best interest, and on and on. If you live nearby, these types of support may be easy to provide, more so after you’ve retired yourself and have a more flexible schedule. And if you live far away, it’s a bit tougher. Even if the particular support your parents might need comes with little cost other than perhaps your own transportation to go visit them, you may still want to mentally budget time to help out. In the rush of planning for early retirement, we often consider only our own needs and wants, or those of our immediate family or household. But consider where your parents are in life and whether they might need more from you when you have more free time as well.

When a Parent Needs Some of Everything

The reality is that some of us have parents who will need a lot of support, financial and otherwise. Or maybe already need that level of support. If you have siblings to share the weight of it all, that’s helpful, but it also means more relationships and feelings to navigate, and the possibility that one sibling will become resentful about doing more than their share of the work. So think through all of this stuff, and ask yourself at least preliminary what your boundaries are. How much financial support are you willing to provide? How much other support to you want to make time for? The real answer could change when you’re faced with an actual parent in crisis, but at least think through the question before that crisis happens and make sure your financial plan is robust enough to back you up. And talk with your siblings if you have them, or with your spouse or other relatives who might be involved, sharing that you want to be sure your parents are well looked after, and that you’d like to talk about how to divide some of the duties that come with that.

Having “The Talk”

I joke that when you’re a kid, your parents dread having “the talk” with you, wherein they illuminate all the gory details of sex, and you get to return the favor as an adult by dreading having “the talk” with them, this time about aging, money and death. (I joke because it’s better to laugh about these things, so you don’t cry.) But as unfun as it may sound, it’s critically important to have the talk with your parents.

You want to know whether they have estate documents like a will, advanced medical directive and durable power of attorney granting decision-making authority to someone should they become incapacitated, as well as whether they’ve established any trusts or other entities you’d need to know about. You want to understand how to access their accounts and life insurance policies when the time comes. You want to know their final wishes, and whether they’d like to be buried someone in particular or cremated and their ashes scattered in a meaningful place. Knowing their wishes around life support and resuscitation is hugely important, especially if you have siblings or other involved family members, to avoid arguing at a time of health crisis. And you need to know at least the broad outlines of their financial situation. Can they truly afford to retire or to maintain their lifestyle? Are there any looming financial obstacles coming?

An alarming number of seniors who end up needing nursing home care end up having to spend down their assets to qualify for Medicaid, which covers nursing home care, unlike Medicare, which doesn’t. And that’s often the time when adult children realize what a mess their finances actually were in, or how little they were living on before. If those children had known sooner, there might have been other options. So don’t wait to have the talk.

Cute-Pico

Here’s a cute picture of Pico to offset the bummer vibe of the last paragraph

In our case, Mark’s parents initiated the talk with him and his three siblings, and they all managed it in a positive way. I initiated the talk with my dad, and though it was a bit traumatic for him at the time, he later was glad we’d gone through everything. And the talk with my mom didn’t go nearly as well because she just didn’t want to have it. I struggled with that, because she’s an adult and is entitled to her own opinions and wishes. But I’m also her only blood relative on the continent and knew from other information that I’d likely have to get involved at some point. I needed to know what was likely to be coming, so I could plan accordingly. So I tried hard to be sensitive, but still pushed to have at least the surface-level version of the talk, and we now know the rough outlines of her situation and can mentally brace ourselves for what may be coming.

The Gift of Time With Aging Parents

When I was still working and would picture my early retirement, images of adventure and travel, and of time to dig into creative projects, always popped into my head first. And it’s been special and meaningful to get to embark on those things, absolutely. But the other best part of early retirement has been having more time with our parents and families generally. My dad lives nearby, and I see him much more now, and can spend real quality time instead of mostly drive-by visits. And we’ve been able to see Mark’s family more, and plan more trips to see them than we could before. Though all of our parents are healthy, and there’s no reason to think they won’t live long lives, we still know that time is in short supply, and we’re doing our best to make the most of it.

Chime In!

What challenges are you facing or foreseeing with your parents? Do you know you will need to or already support them financially? Non-financially? Any stories you’d care to share with all of us about how you’ve navigated some of these challenges with your parents, a spouse, siblings, or others? Or how you made room for parent support in your financial plan? Any questions or concerns you have that weren’t answered here?

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40 replies »

  1. I 100% feel this pain as i’m 90% sure my mom will have issues. She is short term (5 years) living with me right now, but am already planning on how to get her her own place without worrying about rent increasing etc (probably buying a cheaper apartment/town home), for as much as I love my mom… i don’t want to live with her forever! I’m also pretty sure I’m going to be the only child (of 3) financially able to help her. My dad should be fine, his house is paid off and he is contributing to his savings, but I’m still responsible if anything happens to him mentally or physically.

  2. Both of my husband’s parents have passed, and I lost my Dad in the past year so there’s just my Mom to think about. Fortunately she’s an excellent money manager – even with the incredibly expensive care for my Dad in the last four years of his life, she preserved her retirement stash. However, I’m mindful of the fact that her Mom, my grandmother, is still alive and kicking up her heels at the local bingo halls (at age 96!) so I’m expecting my Mom to do the same.

    My husband and I are in the process of moving to our retirement property which has a modest 1 bed/1bath suite on the main floor. We’re intending this to be the guest suite, and have my Mom live there in the winters (to escape the bitter Canadian prairie cold) and possibly full time when she’s ready to leave her house and yard. As a separate suite, it gives everyone their own space and independence, which I think is critical to maintaining good relationships.

    As well, I’m one of four children so I’m hoping that if Mom needed extra financial support in her later years, we’d all help. I know she has all her paperwork in order and has reviewed all her files (financial, insurance, wills, directives) with me. It’s an important discussion to have, so kudos to you for blogging about this.

  3. Wow Tanja, that is an interesting perspective that I haven’t ever considered. I assume that my parents will be able to take care of themselves and their nest eggs will be good for that. But goodness who knows how much support they could potentially need if the medical needs were serious enough to crack and scramble the nest egg.

    This certainly gives me something to consider.

  4. Thanks for writing this post. I’ve written before about the anxiety/worry/stress I experience when it comes to thinking about taking care of my parents. I know their finances and they just won’t have money in retirement. My dad works, but doesn’t make a lot. So most of what he makes, goes to pay for his expenses. He’s 59 and an electrician, so eventually, he won’t be able to work. My mom is 48, but doesn’t work. She did part time work as a cleaning lady when I was a teenager, but she has back problems. I’ve tried to talk to her about getting a small part time job. But she has a mental block on work.

    My brother is 21. He has two more years left of college. Once he graduates and gets a job, I plan on sitting everyone together and figuring out a plan. It’s a bit stressful to think that around age 35, we might want to start a family, but my parents’ expenses will have to be part of the budget. It just gives me another reason why I don’t want to have kids. Hearing about the cost of having kids, doesn’t make me feel great about supporting both kids and parents. It doesn’t seem responsible to me to reproduce, when I have the responsibility of taking care of my parents financially.

    My in-laws are in their mid 60s. They don’t like talking about money. Hoping they are ok financially (have made good money, although I hope they didn’t spend it all). I just don’t know if we will be able to financially support two sets of parents, if they don’t have their act together.

    If there is a club out there for kids who support parents, please let me know. A support group would be great.

  5. Somehow we are fortunate enough that both sets of our parents won’t need any financial support from us in the future, but I’ve had “the talk” with my MIL (and to some extent my father) because even if they don’t need financial help, some day we will have to be involved in their finances or health care. Now some extended family of ours may be in a different situation, and their children are not in a place to be able to support their parents if that time ever comes. Not sure if we would step in at all in that situation or not – honestly I’ve never thought about it before.

  6. My wife and I have the extremes when it come to our surviving moms. My mom is turning 80 this year and doing well. My dad has passed but did a great job managing their money. BUT mom is not into money. She doesn’t want to talk about it nor does she want to spend very much of it which is good and bad. I’ve taken over helping manage her money and try to encourage her to feel more in charge of helping making choices with how its invested. Its really brought us closer and we have been having a lot of fun with it. In fact she got so fired up the other day, we fired her long time CFA as he neglected to disclose the impact of fees on a new plan we asked him to put together. I was very impressed with her. On the flip side, my wife’s mom is not well situated with money. She as no savings, no job and is on SSID. She’s 64 and I am terrified what will happen with her situation. We are in the process of retiring this year at 54 and 44. I know we have some extra funds and could help. BUT it also represents the “extra” buffer I wanted to build into our plan. Trying to plan for the unknown with someone who lives in another state who is not taking care of themselves and has some mental health issues is extremely over whelming.

  7. I’m lucky in that I already manage my parents money for them. They’ve been retired about 10 years now and have about 10 good years left in them, and they trust me with the money.

    We’ve already had “the talk” and have a reasonably good plan for how things are going to go down.

    For however long they’re in good shape I say “go ahead and enjoy yourselves, you earned it.” But once (if?) they need full time care that equation is definitely going to have to change. Full time care is really expensive, but they should have enough.

  8. One thing this article has missed is not all families have anything like normal interactions with parents. My father is dead. He left my mother in good condition, well cared for with a home and income. My mother is now being cared for in low income housing by her favourite son who stripped her of everything she had and now my brother doesn’t allow me any contact as punishment for us refusing to give him ever more money “for her” which of course she never saw. My wife’s parents actively and completely disowned her nearly 30 years ago. We have no problems with parents because we have no parents. if you have parent who loves you, treasure them. We already had “the talk” with our kids.

    • This! I’m single, on track for FIRE in a few years, and currently in the process of removing my sole living parent from my will, 401(k) beneficiary designation, etc. after several years of estrangement. Said parent’s poor financial decisions are no longer my problem. It’s liberating.

  9. THIS! A million times this! I realize that FI is a personal journey for everyone because all of our circumstances are different, but occasionally I do internally chuckle at blogs that point out that they can live on less than $30k per year as I think to myself, “Really? We’re paying half that just to make sure that my MIL is safe, not including our own expenses. It must be nice to not have to worry about your parents, wait until your folks get old.” I realize that makes me sound a little “get-off-my-lawn-ish”, but it has been a point of skepticism for me about some parts of the FIRE community. Part of me thinks that it may be because the community is generally so young that their parents haven’t hit a point where they will really need financial or other assistance and maybe some of the lessons learned will rub off on their folks soon enough that they can accrue savings and start living frugally and so it’s not a worry. If those lessons don’t rub off or if something happens, what are they going to do? Say too bad, so sad, you didn’t save, so go live in a box or are they going to bust their own, pared down budget to step in and help?

    I say this because we’re going through it right now. We’ve had “the talk” with my parents and thankfully they are well prepared financially, legally, and emotionally for the future, and I have two sisters to share the load. Conversely, MIL started getting stressed about finances several years ago because, being born in the early 30’s, she’s of a generation where women didn’t do money, and her husband wouldn’t share anything with her. As a quick aside, this is why the work you’re doing with Fairer Cents is so important, thank you so much. We tried to have “the talk” with FIL and were told in no particular order, that we’re stupid, that everything was taken care of, that it was none of our G-D business, etc. FIL died a year and a half ago and left behind no savings, an underwater house, a lien on MILs car, CC debt, and because they were underinsured, hospital bills.

    On the upside, MIL has taken to online banking, paid off the credit card debt, is saving a portion of each SS check, and has saved almost $2000 in the last year, which she’s going to use to help pay for hearing aids.

    On the downside, we’ve made the following decisions in the past year and a half:
    – To move her out of the house and submit a deed in lieu of foreclosure to the bank because the house is located on a known drug route between OH and WV and was falling down around her ears.
    – To keep her in Huntington, WV rather than move her to us because her friends, her church, and her activities are all there and every bit of research we’ve read notes the importance of social connections and purpose as being key to aging well.
    – To move her into the more expensive apartment because two of the three available complexes have regular police activity due to the opioid crisis. We picked the one that didn’t and that had the added bonus of being where a lot of medical residents live during their residency at the local hospital.
    – To supplement our visits to her with flying her to us regularly so that she can get used to PA over time and so that we can assess her ability to remain independent on a more frequent basis.
    – To pay for all of the above ourselves

    These are the decisions that are coming down the pike:
    – At what point do we move her closer to us and away from her existing social network?
    – When we do move her closer to us, do we buy a condo, which would be cheaper but potentially leave her with only us as a social connection or move her to an assisted living facility where she’d have a built in group of people to befriend, activities, meals, and rides anywhere within a 15 mile radius, but comes at a pretty steep price tag?

    Stuff that keeps me up at night:
    – It takes a year of residence to be eligible for Medicaid in PA, what happens if we don’t move her in time and she needs major long term, skilled nursing care before she becomes eligible?
    – Is it even possible to retire while she’s still with us? The $280,000 number seems unrealistic until you consider that assisted living isn’t covered by Medicare or Medicaid and is $36K/year + , or that we’d have to make major, expensive modifications to our home for her to move in, or that she could live another 15 years in a state between being able to live independently and entering a covered SNF. It’s one thing to say that being retired would give you more time to help out, but the big cost unknowns are the hidden shoals that’ll sink the boat.

    I realize that this reply way longer than probably required, but I’ll close with this, it’s one thing to make a frugal decision that impacts yourself. It’s an entirely different premise to make a decision that impacts an elderly parent. Our first, second, and third considerations were safety, safety, and safety. Then came comfort. And cost didn’t show up until about 5th or 6th. I expect that when faced with it, it’ll be the same for many no matter how frugally we live our own lives.

    Thank you for writing this blog post. It’s so important to try and plan for or at the very least be prepared for impact.

    • Great post and awesome comment. Right there with you. Plus, the added complexity of divorced parents and in laws who have all remarried (gives us 4 sets of parents instead of 2) and extended family in our parents’ generation without children who look to us.

    • Thank you for sharing all of this! My husband doesn’t want to retire until all of our parents have either because of all the unknowns. Covering their travel to visit us is something we’re strongly contemplating as well. We would love to see them more often, but they’re far enough away that it isn’t easily a weekend trip, so we don’t have as much time with them as we would prefer and my husband feels guilty that he was the one who moved away. And we totally agree with you – parents’ safety and comfort are far more important than how much things cost. We will just adjust our plans.

  10. This hits home. When planning my FIRE, my parents are a major concern. They’re not healthy. At 52, my mom doesn’t have much saved for retirement, and what she does have she wants to spend on home renovations. I’m trying to convince her otherwise. It’s going to be a tough road ahead, and I’ll already feel resentment.

  11. Very important topic! Part of the reason my husband retired was to have what turned out to be a last bit of time with his dad. For a few years prior to that, I worked part time to fill the caregiver on call role for him. He was a wonderful man, but it was a difficult, stressful period for us all. We managed to set up the appropriate trust and get him “Aid and Attendance” from the VA….something to look into if you have a loved one who served during wartime. That helped to minimize the drawdown on his assets, and he was able to stay in a good memory care facility only a mile from us until he passed at age 96. As for my parents, who are in their late 70’s, I do not have their full financial picture. They did not have high incomes, but were diligent savers and live a miserly life since that is the way my mother likes it. For a while she kept wanting to “give me money”, but I would not let her. I finally told her that if she did, I would set it aside for their care later on and not spend any of it anyway. Given our situation, I could never in good conscience take money from my parents. Even though I’m an accountant, having “the talk” with her is a very daunting thing. I guess I feel that at this point, there’s really nothing I can change much. She and my stepdad have a good fee only financial planner and have their wills and directives in place. Since she refuses to spend much anyway, for now I don’t see much point in digging into her finances unless she invites it. Having a POA would be ideal in case they need us to step in to manage at some point. Thankfully we got that just in time with my FIL. But I don’t know that she would be open to it at this point.

  12. This topic certainly ring home for us. We are going through this as we speak. We are trying to do everything we can to ensure the support of our aging parents (whom unfortunately are not financially prepared), but have a feeling that our plan may need to change. The saving grace is Mrs. Frugal is currently a stay at home mom and so, if need be, she can re-enter the work force to help us stay on track. We both have one other sibling but somehow our family is the only one ready able to help out financially. Glad you also pointed out the non-financial support as well because, although that does not hit us financially, it affects our free time. At the end of the day, we have no problem helping out, we just wished we would have factored in some of the demands ahead of time.

    Thanks for sharing. Best wishes and success on your personal journeys! AFFJ

  13. Great topic, lucky for us my parents retired early and are pretty financially sound. Mrs. T’s parents might be another story. Our situation is maybe unique as her parents are in Denmark and mine are in Vancouver (live close to us for now). If we decide to move elsewhere than Vancouver in the future, this may change how we can help them as they get older. Definitely something to consider and start planning.

  14. One set of parents has always talked about money and we aren’t worried about them. We’ve been preparing to have The Talk with the other set of parents. (Fun fact: none of our parents ever talked about sex with either of us! My in-laws were so overjoyed when my husband told them he had a girlfriend.) So far, we’ve listed out all of the facts we do know (small bits they’ve said over the years), each of our questions, each of our worries, and then worked through some lead-in questions and talking points and ran them by my therapist. We’ve also been doing lots of research of facts we can find without talking to them, like better understanding what support they will likely get from the government, how taking it early/late will affect the amounts, how much their house is worth and how much they pay in property taxes, and guesses as to what their budget looks like. We also agreed that the person initiating the discussion needs to be their biological child. That’s as far as we’ve gotten with that part because the discussion hasn’t quite happened yet…

    We’ve talked about upper limits and ways in which we can support them, which we assume will happen in some way, at least financially since we are far away and moving them closer isn’t an option. Neither of us are really feeling resentful and their kid feels like it’s important to do this since they provided a loving childhood home and they couldn’t possibly imagine not helping. We have at least one sibling each, but we are in the best financial situation by far, so we assume much of the financial support would fall to us.

    We’ve also catapulted ourselves into an entirely different socioeconomic class which happened rather exponentially over the last several years – as in, my husband’s net worth was still negative when his parents last knew how much money he made. So our big worry too is that given that parents always want to make sure their kids are okay before taking care of themselves, how do we make it clear to them that we are ahead on our goals and that helping them isn’t going to be too impactful on our own finances without telling them too much? Where is that line? Like, the other set of parents know plenty of details (they are super nosy and we do occasionally tell them small bits to keep them happy), but I’m still not sure that they would believe us if we told them how much my husband actually makes now or how much our current net worth actually is.

  15. My mom says aging is not for sissies but I say being a child of aging parents is also not for sissies. I am very lucky that my parents will most likely not need financial help from my sister and I but the emotional help and help with health issues is also very daunting. Mom tried to have a conversation with me this weekend when I was visiting about funeral plans for the future. I cannot deal with that yet. I have already helped them downsize from my childhood home. So glad we did it when we did. My mom’s health has deteriorated some and there is no way they could be in that house right now. The next concern is what if something happens to my dad, how do we take care of mom? I have given up applying for long term (3-5 year) jobs overseas that I was planning on applying for. I cannot move home if help is needed without giving up my job and my retirement security.

  16. My parents have talked with me about their wishes and have saved enough (likely more than enough) to support themselves throughout their lives. That is a gift to me and I hope to save enough for my partner and I to live out our lives without asking for financial support from our kids. That’s a gift I want to give them.

  17. So appropriate! And the triple whammy of kids (in the near future), and siblings (two, neither of which are financially secure), and two spendthrift parents is exciting, to say the least. So far it’s most affected our housing choices. We choose to renovate and pay for an apartment over our garage. It’s generating income now – and will slowly pay for the cost of the renovation over the next 2 years – but it’s priceless to know I have a separate apartment to which I could move my parents or siblings if needed (and anticipate this will happen as they age, as my parent’s cannot currently afford their mortgage if one of them passes away before the other). Financial planning is so much more than just staying our of credit card debt!

  18. Where do you draw the line between taking care of yourself and your parents? My two sets of parents have debt, zero savings and no retirement plans as they enter their sixties. I can’t possibly support all of them. I got overly stressed when I realized their situations but have since come to terms with it. I would go crazy trying to take full responsibility for them. I can’t financially support four additional adults; however I can take care of myself, provide as much emotional support as possible and practice flexibility and resilience at every opportunity. At some point you have to realize you can’t ‘fix’ other people’s relationship with money. Actually, my parents aren’t that stressed about it so I’m going to follow their lead and not worry about things outside of my control.

    • I agree Kayla. My parents are both dead but my younger sister has debt, very little savings, no retirement plans and no legal documents. I’ve begged her to at least do a will and HCPOA but she doesn’t want to deal with any of it. She also has an adult son who lives with her and is dependent on her for everything. My husband and I retired early and I’ve already told her I will not be responsible for her son should something happen to her. That’s her job to take care of him, not mine. I’ve realized I can’t fix her relationship to money and responsibility so I’m trying not to worry about it.

  19. I think this topic is very important and am glad you wrote about it. It is hard to accept your parents are no longer as capable as they were when you last lived with them and good to discuss boundaries, expectations and priorities in advance with your spouse or siblings.

    After my usually very healthy dad was diagnosed with surprise stage 4 cancer last summer I was stunned by the impact that had on my finances since they had great finances and could pay for the $5K per month pills and everything else that the oncologist recommended on their own. I still had lots of extra travel expenses including a new transmission from the extra mileage, blew through my phone data multiple months trying to work at their house or FaceTime them with their grandkids, buying things he and my frugal mom would never buy for themselves but clearly needed, paid child care when I was away and major medical expenses for me after a stress-induced medical issue popped up. Darn sandwich generation! After he passed I was very glad to have had the funds to be there and far enough along in our own FI journey to not worry about possibly being fired for missing so many office days. The Talk was very helpful in making final arrangements as my mom was numb and stressed and had trouble remembering things at the time. I am afraid the real work is just beginning as my mom is floundering and wants to downsize the big house but unable to confidently make decisions on her own after a lifetime of deferring to my dad so the extra travel expenses continue…

    One reason we do “stealth wealth” and plan to transition to fun jobs in the future rather than fully retire is after seeing how my extended in laws all expected the “rich uncle” to bail them out until they alienated him altogether. He could no longer attend any family event without someone or multiple someone’s asking for money and when he said no they acted like brats and spoiled the event. We’ll blame a midlife crisis for leaving Corporate America. But kind of stressful living the double life, no?

  20. Sigh. My mom was fine, and then over the past few years has loaned money to my brother. She did not keep track of it. I started digging and found the loans had crept up to $300K, which puts her financial security at risk. Good chance they will not be repaid. It’s very frustrating to have done so much to help her be on solid ground and then this- like I get to pay multiple times…and have it threaten my own early retirement plans.

    • Yep. My mom depleted her entire savings, had her credit score ruined and had to file bankruptcy trying to help my worthless sister and BIL. They never paid her back and they never even thanked her (or apologized) – they think they’re entitled to it. She’s an adult and she made her own choices, but I can’t in good conscience let my mother be homeless, so I get to be the one who takes on all the financial and emotional burden.

      We want to travel a lot when we FIRE, but I’m not sure if we’ll be able to do that and support my mother at the same time… *and* the women in my family live well into their 90s, so this is going to be a concern for several decades yet. Sigh.

  21. Thanks for posting writing about this subject Tanja.

    I’m older than many of you in the FIRE community, and am mostly a lurker rather than a poster. But with this topic, I’m willing to be a poster.

    I’m mid 50’s and married with 2 kids. I also have 4 parents (my own plus my in-laws who I love dearly). I’ve been in the sandwich generation for 35 years as I’ve been supplementing my parents housing for almost my entire adult life. WHY you ask? Well, I’m asian and I was raised to respect and take care of my elders, regardless what’s required or for how long. I have many siblings, but fortunately have been able to get educated (paid my own way thru state college, no financial aid, and NO debt), my siblings too … and I landed a solid job after college and haven’t looked back since. My siblings can help if they want to, but I’m not asking them to. I’ve been working full time … actually more than full time … basically I’ve technically worked 30 years in Corp America, but the amount of hours I’ve logged in those 30 years basically puts me at a 40 year career of slave labor. For the most part, I’ve loved my jobs and my teams, and only the last 2 have been grueling, and I’m ready to FIRE.

    Getting back to being in the sandwich generation… I still support ~ 25% of my parents expenses, plus manage their finances, plus visit them half a dozen times per year (air travel required), plus give them regular spending money. In addition, I’m fully prepared to put my 2 kids through college. Again, WHY you ask? I do this because my parents raised me and my siblings with no formal college education themselves, and while we grew up lower middle class … I had a roof over my head, clothes on my back, food on the table, a FREE public education, and 2 parents who cared enough to drill into our heads the importance of a college education, a good job, a strong work ethic, and tenacity to keep forging ahead.

    What my parents taught me growing up was well worth the 35+ years that I’ll be supporting them because I wouldn’t be FIRE at mid 50’s and I also wouldn’t have enough FU $$s to not only support them in full retirement, but also support ourselves comfortably, and still be able to leave a sizeable legacy to our children.

    So, I’ve been doubly cursed or doubly blessed to have both parents and kids to support. I wouldn’t have it any other way. I sure do hope some of me rubs off on my kids, so they will want to look after DH and me when we need help down the road.

    Thanks for bringing this topic to the discussion board. You rock!

  22. Thank you for bringing this topic to the table. We have only my dad left and my brother is on hand seeing to his needs. Dad is in assisted living with money from his rentals covering his bills. I’ve tried to have the talk with the kids but no success there. So I’m going to put together a binder with all the info needed for them to finish things off for us. We should have enough to see us to end of life with a legacy of some sort. One thing to keep in mind is that many states have filial responsibility laws that allow providers to come after the kids money after parents pass.

  23. The Talk is so important. Many people think that because they have a living will they’re all set, but unless their loved ones know what that living will says and have access to it, it’s of absolutely no use in an emergency. In addition, the paperwork can be pretty vague and family needs to know what’s really important to you in terms of quality of life. For example, my mom doesn’t want life-prolonging measures if she can’t think clearly and be mobile. Her husband doesn’t care about mobility as long as he has a way to use a computer mouse.

    In addition, if someone truly wants to be DNR, they should have the paperwork on the fridge for EMS to find and ideally a medical alert bracelet in addition to making sure family knows and agrees with this. If family doesn’t agree with a patient’s wishes, the patient should choose a different power of attorney and make sure that paperwork is also easily accessible to EMS and that the POA has a copy.

    It’s now easy to scan or take photos of the paperwork so you can have it on your phone and with you at all times.

  24. This post really highlights a great reason to become financially independent. Because your kids should never have to be financially responsible for you. The emotional cost of caring for aging parents is high enough without adding a financial one also.

  25. Excellent post. This is something that has been on my mind lately. I’m expecting that one day we’ll likely be financially supporting our parents but without having The Talk, the numbers are just a big unknown and it makes it difficult to account for those costs in our retirement plans.

  26. Ever since my 78yo parents asked me to assist them with their finances a few years ago, I have struggled to educate myself about the issues they are facing compared to my stage of life. Right now there are tons of blogs for people my age (40’s) to take charge of their own finances including FIRE (we are FI, just not RE yet). However to look at finances from the perspective of an older generation is very different. Not many people that age are managing their own finances so there are few blogs relevant to that. I took over their investments at their request when they found out how much their advisor was costing them in fees, both high investment fees and oversight fees. Then I had to start from scratch to determine their cost of living/income needs were and figure out how to invest an appropriate asset allocation since they are going to have to cover any long term care coverage they will eventually need (their advisor never talked to them about long term care insurance). Medicare, estate planning, insurance coverage, variable annuities are all issues I have had to learn about in addition to managing all our own finances. The good news is I feel like this will all be helpful knowledge as we get older but it has been a struggle to gain enough knowledge to be confident that I am doing what is best for my parents.

  27. Have that talk. It went well for us. Our kids deserve to know what we hope for the future. They also know that we have plenty to take some great trips and spoil them and the grands a bit (college will be on their dime). We want to pay our own way, but we want to be close to them as well. Neither of us desire “independent elderly living”. Yuck!
    We (61 &68) have had some chats with our children (32&34). Both our kids are planning to be FIRE. They have listened to our droning on and on about saving for retirement. They seem on track- even with spouses and kids.
    Currently, we live nicely middle class with our pensions. When I get SS, that money will simply be put aside in savings. My husband’s health insurance is quite good, mine is so so. Our kids (wish there was a better term for adult children) know that. They are also aware that we would LOVE to be in a “granny pod” with robot assistance in our 80’s/90’s. Our plan is to sell our house when we are in our late 70’s and put something on or near both of their houses- so we can travel back and forth- bi coastal US. Sounds like a crazy idea? It is what both of our great grandparents did back in the day. Our pensions and SS should be plenty for the added expenses of the places. I think the sale of our house will give them the money needed to make it happen.
    Now, I have to pray that our relationships will continue to be great for the next 30 years (and pin that DNR to the fridge)!

  28. Great topic! I was shocked to learn several years ago that my seemingly upper middle class parents have no savings. They asked if I would co-sign a refinance of their mortgage—that is when I found out that their nice condo had very little equity, they had been paying interest only mortgage for years.

    When I said no to co-signing, too risky, they really didn’t want to talk about finances further, “we’ll be fine”. It’s frustrating as I’m the only kid with financial wiggle room, just retired at 62 yo, and have no idea what might be needed by them down the road.

    I love them and will try to do what I can to help, but do feel frustrated that they spent money on an expensive country club instead of saving some of it. Very difficult subject.

  29. It’s a very difficult and tricky situation and having the talk doesn’t always go as planned. I’ve tried multiple times with my parents, and while I know my dad gets it, my mom prefers not to face the problem. Unfortunately I have three sisters who also don’t have any solid financial plans, so the responsibility to help my parents out falls on me. I don’t live near them, so my main contribution to them at the moment is financial. I feel like the more I tried to bring up the subject, the more I pushed them away. So now I no longer bring up the topic. I’ve offered to help, there isn’t much more I can do until they’re ready to accept it and make some major changes in their lives.

  30. Right now, I’m not sure whose aging I’ll need to worry about. The only parent I had any communication with is now gone, and I’m still handling his estate because he refused to admit he was dying and wouldn’t get affairs in order. Sigh. I’m down to four immediate relatives. There’s only one I think I will need to help at any point. He’s only slightly older than me, but his earning potential is a small percentage of mine. Once I get the nest egg rolling, I want to help with some of his burden. I want him to be able to focus on parenting and not worry about student loans he can’t make a dent in.

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