If your parents are getting older, they’re probably planning for the future. But what if they’re not? If you have a hunch they haven’t saved enough money for retirement, you might be worried, and for good reason. How can you help them out without jeopardizing your own future?
How Much Should My Parents Have Saved for Retirement?
The first question most people have when they start planning for the future is “How much money does someone need to save for retirement?”
Fidelity Investments suggests saving 15% of your annual pre-tax income. When you talk to your parents about their finances, you’ll want to determine how much that would be, and compare it to what they’ve saved so far.
How Can I Help My Parents if They Don’t Have Enough Money Saved for Retirement?
1. Look for Signs That Your Parents Are Worried About Money
If you’re not sure if your parents are struggling, and feel awkward about asking, make sure you have grounds for doing so. Look for signs that they may be struggling when it comes to saving money.
Some signs of financial worry to look for in your aging parents include:
- Piles of unpaid bills or collection notices in their home
- They develop new spending habits – i.e. they’re spending much less than they used to
- They’re getting calls from unusual numbers that might be collections agencies or credit card companies
- They seem withdrawn, upset, or stressed out, especially when someone brings up the subject of money
- They mention receiving calls or letters about sweepstakes or offers for free vacations, etc. Senior citizens can be vulnerable to scams and are often targeted by con artists.
2. Talk to Your Parents About the State of Their Finances
On talking to your parents about where they are financially, Barros says:
“The first thing you need to do is have a very transparent conversation with your parents to see where their finances are right now. You might be freaking out about something you don’t need to freak out about.”
She goes on to say that many adult children don’t have any idea of what their parents’ financial situation is – how much money they make, how much they have saved, or what their monthly expenses are.
Talk to them about these things, as well as how much debt they have and if they have a pension plan that will help out in retirement.
After this conversation, you might realize that your parents are better off than you thought. However, if you do find out that they’re struggling, there are some ways you can help them, while still planning for your own future.
Stefanie O’Connell Rodriguez, host of the Real Simple Money Confidential Podcast, says that children can come off as condescending when bringing up retirement with their parents because “it’s a role reversal of the traditional dynamic between parents and children.”
For parents, it may feel like their children are now trying to lecture them about their finances. Instead, O’Connell Rodriguez recommends starting the conversation by depersonalizing it. You could mention a news story you heard about how a lot of people are undersaving for retirement, and segue into the conversation that way.
3. Decide How You’ll Be Able To Help Out
Once you have a clear picture of where your parents stand financially, ask them what they want out of retirement. Do they see themselves staying in the home they live in now or retiring elsewhere? Do they want to live alone, or would they be happy living with you or one of your siblings, perhaps helping to care for any children?
Once you have an idea of how they see their future retirement, you can figure out how you can help them to achieve that or, if it’s not feasible, discuss other options.
4. Help Your Parents Figure Out How They Can Cut Costs
If your parents haven’t saved enough for retirement, then it might be helpful to figure out how they can cut costs. If your parents are open to the idea, living in a senior living community often saves money, compared to the costs of paying a mortgage, utilities, homeowners insurance, etc. If you’re not sure if your parents can afford senior living, there are ways to get help paying for assisted living and other types of senior living.
5. Consult a Financial Expert
You might also want to reach out to someone who’s an expert in this area for advice. Consulting a financial or retirement expert means that your parents will get advice tailored to them and their needs. A financial expert might also know of some ways your parents can make their money go further.
Stress-free Living at Eagle Flats Village
If you and your parents are stressing out over finances, why not let someone else do the worrying? At Eagle Flats Village, we do everything we can to make life stress-free for our residents.
The worry-free lifestyle at Eagle Flats Village means:
- All utilities, including basic cable, are included in each private apartment (landline phone not included)
- Chef-inspired, nutritiously conscious home-cooked meals are served in-house daily for breakfast, lunch, and dinner
- Exceptional care by trained on-site staff 24/7 under the direction of a Registered Nurse
- Personalized assistance with bathing, grooming, hygiene, and dressing
- Transportation availability into and around the Vernon community
- Weekly light housekeeping
- Weekly laundry service
- Medication management
- A full calendar of enriching programs and social events
- Convenient access to on-site beauty and barbershop
- Pets allowed
- And more
Imagine if your parents never again had to worry about utility bills, home maintenance or repair, yard work, cooking, or cleaning.
Could your parents benefit from living in an all-inclusive community?