Moving on, sorting out
By Lisa Lewitzke
Recently, I’ve been taking a trip down memory lane. I’ve been helping my parents get ready to sell my childhood home, where they have lived for the last 45 years.
My parents are savers. And although that has done them well with their investment accounts, it has proven to make this task of moving out a very long and winding road. Just when we think we have everything under control, we find one more bin or box that needs to be sorted through.
It got me thinking that we should be doing the same for their investments.
According to a report from the Center for Retirement Research, at Boston College, older Americans can improve their well-being – financially and psychologically – by moving from their homes. Positive effects particularly result from moves that are planned by the homeowners instead of forced upon them.
So my parents and I decided to sit down and sift through their finances as well. It was harder than it sounds. Just like cleaning out their house, as we started digging through statements, we kept finding one more account or stock certificate that needed to be dealt with.
Based on our experience, here’s some advice:Get talking.
Over the years, I have heard many clients ask when they should have this conversation with their family members. It’s never too early to be proactive and get things in order.
It may feel like you are prying or being nosy, but it’s better to have the conversation when everyone is in the correct frame of mind. Waiting until your parents’ health is failing or something terrible happens will put additional strain on a difficult time.
Because of what I do for a living, I know the right questions to ask my parents. However, that doesn’t mean it was easy.
In a generation where everyone is posting what they ate for dinner or their child’s most recent artwork, it may be hard for some of us to respect our parents’ personal boundaries on this issue. But finances are a very private matter and something that some parents may not feel comfortable discussing with their children. Also, they may not want to burden their children by asking for help.
You need to help your parents understand that you are simply trying to make sure they are comfortable in the years to come.Be patient.
Some people of my generation tend to discount the feelings of our parents regarding the need to hold on to things.
It’s very easy for me to give away a box of dishes my parents no longer use or destroy old bank statements from years ago. I am too busy as a working mother of three to allow clutter in our house. In my generation and certainly in my kids’ generation, everything seems more easily disposable. We don’t have sentimental attachments to things like my parents do.
Their attachment to ownership is a hard habit to break. If you can help accumulate all the relevant papers your parents need and keep them in a safe place everyone knows about, you will avoid an Easter egg hunt in the future.
Keep only what is relevant, and make a list of all their accounts and contacts names and numbers.Name names.
Help your parents list and title their accounts properly. Assign Power of Attorney (POA) to their bank accounts and Transfer on Death (TOD) on their investments.
Designate the proper beneficiaries and successor beneficiaries so that everything is covered. Help your parents meet with a lawyer to set up a will, a trust or a health care proxy. (For more information on beneficiaries, read this article by Isabelle Denton.)
You may want to seek help from your financial advisor to make sure no question is left unanswered.
It has taken months to get my parents’ house ready to sell. It has taken just as long to get their finances in order.
Be prepared to put in the time. My parents have 45 years of memories and keepsakes to carefully go through, and that shouldn’t be rushed. The emotional process and detachment to some of those things will take time, but it will allow them to step forward carrying less of a burden.
It is time now to enjoy the life they worked so hard to make without having to worry about me and my brother and our families, should something happen.
Although it will be hard for me to never go back to the home I grew up in and see the tree I planted in our front yard, I am excited for my parents to take this step and happy to have helped start the next chapter of their lives with a little less clutter.
Lisa Lewitzke is a registered representative at Landaas & Company.
(initially posted April 3, 2014)