VOICES FROM THE INDUSTRY: This Thanksgiving, start making plans for the future

September 29, 2008

Many of us will visit parents over Thanksgiving and the holiday might be just the time to have a hard-to-hold conversation about financial preparedness.

While it can be a difficult conversation to have, its important for adult children to check in with aging parents to make sure they have a plan for retirement and estate needs. It is estimated that about 50 percent of American adults do not have a will, which can result in losing control of your financial future. Don't let that happen to your family. Make plans today.

As an adult, talking with parents about their finances can be an uncomfortable conversation. Yet, it is important to explain to parents that estate planning is crucial no matter a person's wealth.

As an executive of a financial institution, I have compiled a set of tips for making this conversation a success.

Stress the importance

Open the conversation by letting your parents know that they shouldn't be embarrassed if they still have work to do to get their finances in order.

It is estimated that Americans 65 and older have the most assets in history for their age group but, shockingly, 30 percent of them say they don't have enough money saved to meet basic living expenses during their retirement years.

Stress the importance of being prepared for the future.

Use third-party experts

Consider turning to a mutually trusted third-party. Perhaps a local banker that your parents have worked with in the past can provide a referral source to handle the more complex questions your conversation may raise. They should also be able to direct them to additional estate planning resources.

Gather the right resources

Financial institutions can provide basic literature to use while talking to your parents. Sample documents for wills, trusts and power of attorney can aid discussion and function as helpful resources.

Many documents may seem similar, but have very important distinctions. Have brochures that help distinguish the need for the different types of services.

Consider an attorney

If your parents don't already have a relationship with an estate-planning professional, work with them to find someone with whom you are both comfortable. They will need to rely on their attorney to make sure their will accurately and legally expresses their wishes on the disposition of their estate.

Take inventory

Develop an inventory of their savings, investments, retirement plans, real estate titles and liabilities.

Work with your parents to bring together the key data from all bank accounts, investment plans and real property starting with their 2007 tax forms.

Set goals

Create financial goals for the next few years. Keep in mind that retirements can last as long as 30 years.

Your parents may need to think about investing more of their money. Remember that health care may be their largest retirement expense and be sure that appropriate health insurance is in place.

Both you and your parents can rest easier knowing that by organizing their financial information and documents now they'll have less to worry about in the future.

Rake is senior vice president and Indiana Regional Manager of Huntington National Bank. Views expressed here are the writer's
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