It's very easy to assume that parents have their retirement plans figured out. After all, they've had plenty of experience to take care of themselves, right?
Many of us held that belief until the COVID-19 pandemic happened. The majority of those hit hard by the pandemic are senior citizens who were already struggling financially. According to a study by the Nationwide Retirement Institute, close to 40% of seniors say the pandemic has changed their retirement plans. Many more say they may be forced to continue working.
Financial experts warn that unless something is done, retirees and those about to retire are more likely to have a difficult time in the next few years. If you don't one your parent to be one of them, have a financial conversation with them about their changing retirement plans.
We want to help you do that. So in this post, we share four tips to set the tone right and have a meaningful discussion.
Use The "Pandemic" To Break The Ice
Talking about money with aging parents can be challenging. For many years, personal finance especially with parents has been treated as a taboo. Kids never asked how much parents make, if they're saving, and their plans for the future.
And this is why older parents may feel like you're intruding if you're not careful. But during these uncertain times, the pandemic has created a situation to exploit- tough times.
For instance, explain to your parents that you're struggling financially. Ask for advice. Ask them if they would help you and your family if you get sick. Provide a guidebook of your finances and bills to pay. Once you do this, it will be easier to start the conversion.
Asking them about their retirement plans after the pandemic can be another way to start a conversation. When you understand their desires, it will be easier to move to their current financial situation.
Listen To Their New Retirement Plans
When your parents open up about their financial situation, find out what they plan to do during retirement. If the pandemic has had a huge impact on their finances, listen to what they intend to do to remedy the situation.
Some parents just need a little assurance that all will be well. Don't be so quick to advise against their plans. Listen first then comment later.
Talk About Their Spending Needs
Many seniors may still have some cash available to use for short-term spending. This may prevent them from tapping into their emergency savings.
But when long-term problems arise, they may be forced to use it. So ask your parents about their short-term strategies even if you know they have a pension. This is because the recent economic downfall will most likely affect these funds.
Look at their needs. Find ways to help them save money. You may advise them to downsize, reduce eating out, move to an affordable city, and many more.
Share Ways To Make Money
As mentioned earlier, some retirees may want to continue working to stretch their savings. If your parent mentions it, encourage them to do so.
Help them find work by looking for jobs suitable for them. Look at their resumes, polish them, and teach them to use online platforms when making applications. But don't stop there.
During tough economic times, it may be difficult for seniors to find work. Therefore, it may be wise to help them start a side hustle. Look at their skills, passion, and hobbies to find out what they can offer and get paid for it.
For example, encourage them to offer pet sitting services, stay share with fellow retirees, teach online, write, and many more. This way, they can make money from home.
The COVID-19 pandemic has affected everyone. And while everyone is focused on moving on post the pandemic, let's not forget our aging parents. They too may need our assistance. So don't assume they're OK. Use these tips to help them through this challenging time that has changed retirement plans.