Are you concerned with your parents and their future? If you are, you should talk to your parents about their retirement plans. In fact, the sooner, the better. Doing so can give you, as a loved one, comfort and peace of mind. You should start discussing retirement with your parents when they reach the age of fifty; however, you can start the conversation sooner if you wish.
When talking to your parents about retirement, determine what their retirement wants and needs are. Where do they want to live? What type of property or establishment do they want to live in? What activities or hobbies would they like to enjoy? It is important to know how your parents want to live in their retirement years, as it will have an impact on how much they need to save.
Next, it is important to determine how much your parents currently have saved for retirement. Is it enough? Do they even know? If you are concerned with asking your parents, take the above mentioned approach first. Asking your parents about their retirement goals can ease you into the conversation about costs and savings. Asking your parents outright how much money they have saved for retirement may cause tensions to erupt.
When discussing their retirement with your parents, make sure your parents know that they cannot live on just their social security benefits. You may be surprised how many retirees plan to do so. Once again, be sure to take a cautious approach. You want to lookout for the best interests of your parents, but don’t treat them like a child who knows nothing on the subject. Returning back to social security benefits, tell your parents you read online that most retirees only receive about 40% of their living expenses through social security benefits.
In keeping with social security benefits, you should encourage your parents to request a statement of their benefits. This is easy to do online or over-the-phone. This statement can give them an estimate of how much they will receive in social security benefits. This is a good wakeup call for those who believe social security will cover their retirement expenses. Be sure to remind your parents that their statement is just an estimated total.
You will also want to examine your parent’s profession. This is important, as the economy is having a negative impact on many businesses. Some older workers are finding themselves forced into early retirement. Is your father or mother in the auto industry or another industry that is taking a hit? If so, there is a chance they could be forced to retire early, if it hasn’t already happened. In the event of forced, early retirement, do your parents have a plan?
Also, discuss healthcare with your family. If your parents were to move into a retirement community examine the costs. Then, examine the costs of long-term care. When your parents live together, they are able to save money, but what happens when one gets sick? Can your parents afford two separate living arrangements? Make sure the cost of long-term care is realistically entered into their retirement plan.
Speaking to your parents about retirement is a step in the right direction, but they can still benefit from professional help. If you feel that your parents are unprepared for retirement, offer to schedule and pay for a meeting with a financial advisor.