So what do you know about your parents’ finances? Chances are good your assumptions are off target, especially if you’ve pegged them on the lower end.
According to a recent study and paper produced by Fidelity Investments, there is a “vast disconnect” between elderly parents and adult children on this very point. The disconnect usually is due to a failure to communicate.
Both Reuters and Forbes addressed this matter in time for Thanksgiving, a traditional time for family gatherings. In case you missed the articles, the Reuters article was titled “Please pass the gravy, and how much are you worth?”, while the Forbes article was titled “Generations Apart: Talking Retirement And Estate Planning Over Turkey.”
According to the Fidelity Investment study, the children of elderly parents tend to miscalculate their parents’ wealth by an average of $100,000. While these same parents believe they’ll be fine for the duration of retirement, fully one-in-four of their adult children believe they will need to come to the financial aid of their parents later in life.
In short, there truly is a “vast disconnect” between the generations on this fundamental matter.
But alas, with Thanksgiving gone, you may still have another opportunity to address this important matter with your elderly parents through a family gathering during one holiday or another before year’s end. In preparation for “the conversation,” however, you might want to consult these two timely articles to help you broach the subject in an adult, matter-of-fact manner.
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Patrick J. Kelleher is a South Shore, MA resident and estate planning attorney serving and protecting families and businesses in the South Shore, MA area. For more information on estate planning visit our firm’s website at www.MyFamilyLifePlan.com where you can check out our Blog, free Newsletter library, free Estate Planning Channel on Youtube and sign up for a Free e-Newsletter!
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Reference: Reuters (November 21, 2012) “Please pass the gravy, and how much are you worth?”
Forbes (November 21, 2012) “Generations Apart: Talking Retirement And Estate Planning Over Turkey”