How to Have Conversations With Your Parents about Money, with Cameron Huddleston
Welcome to The MapleMoney Show, the podcast that helps Canadians improve their personal finances to create lasting financial freedom. I’m your host, Tom Drake, the founder of MapleMoney, where I’ve been writing about all things related to personal finance since 2009.
Have you avoided talking with your elderly parents about their finances? Do you know if they’ve created a will or a power of attorney? If not, there’s no better time than now to start a conversation.
My guest this week knows a thing or two about having conversations with parents about money, after all, she wrote a book on the topic. Cameron Huddleston is an award-winning journalist, and author of the book, Mom and Dad, We Need to Talk: How To Have Essential Conversations With Your Parents About Their Finances.
According to Cameron, talking with your parents early on is the best way to ensure you’re in a position to help them down the road, should they no longer be able to manage their finances on their own. And it’s not just about helping them with their banking. As their child, you want to make sure that when they pass away, their final wishes are respected.
Unfortunately, for many, money can be a taboo subject, and parents themselves can feel uncomfortable discussing their finances with their children. Cameron’s advice is to always be respectful. Look at the big-picture issues. Start by simply asking whether or not they have a will or a power of attorney. If you’ll need more detail, ask them to write it down for you, so that at least you know you’ll have access to pertinent information when and if you need it.
As Cameron puts it, the consequences of not having these conversations are far worse than the discomfort of bringing up the topic for discussion. Whether you’re tasked with caring for an ageing parent today, or you’re approaching that time in life, be sure to listen in, as this episode is for you.
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- Discuss finances with your elderly parents while they’re still healthy
- Ask your parents whether or not they have a will and power of attorney
- Be respectful when talking with your parents about their finances
- Why many parents don’t like the idea of giving up control to their kids
- Work together with your siblings to support your parents
- Even in strong relationships, talking about money can be difficult
- Money doesn’t have to be a taboo topic for families
- Why you should talk openly about money with your kids
Are Have you avoided talking to your elderly parents about their finances? Do you know if they’ve created a will or Power of Attorney? If not, there’s no better time than now to start a conversation. My guest this week knows a thing or two about having money conversations with parents. After all, she wrote a book on the topic. Cameron Huddleston is an award winning journalist and author of the book, Mom and Dad, We Need To Have A Talk – How To Have Essential Conversations With Your Parents About Their Finances.
Welcome to the Maple Money Show, the podcast that helps Canadians improve their personal finances to create lasting financial freedom. Do you know having a good credit score can help you get better rates on your mortgage, insurance and loans, saving a lot of money in the long run? Our sponsor, Borrowell, will provide you with a free credit report along with monthly updates and recommendations. To get started, visit maplemoney.com/borrowell today. Now, let’s chat with Cameron.
Tom: Hi Cameron, welcome to the Maple Money Show.
Cameron: Hi. Thanks so much for having me on.
Tom: I know money is a really taboo topic. You wrote a book that came up with an interesting thing I really hadn’t thought about, which is having money conversations with your parents. Your book is called, Mom and Dad, We Need To Talk. Can you go through how that came about? What made you come to this conclusion, because I never really thought about that? We’ve done shows about talking to our kids about money and stuff, but I’ve never thought about it the other way around where you have to talk to your parents.
Cameron: I must be crazy, right? Because money is taboo and talking to your parents about money is pushing the boundaries there, especially because so many older generations really do think of money as a taboo topic. I wrote this book because of a personal experience. And honestly, I didn’t want people to make the same mistake I made. I did not have conversations with my mom about her finances soon enough and I ended up having to get very involved with her financial life. I manage all over finances now because my mother was diagnosed with Alzheimer’s disease 10 years ago. Actually, more than 10 years ago at this point. I had a conversation with her before the diagnosis. I mentioned to her several years before her diagnosis that she should look into getting long-term care insurance to help pay for long-term care if she ever needed it. And in America, long-term care insurance is the only type of insurance that will cover long-term care. I know in Canada they do have long-term care insurance, too, but you guys also provide long-term care facilities for people. That’s correct, right?
Tom: Yes, there is. I don’t know all the details around it but there is, I think, some income tests and stuff on whether you can get some kind of support.
Cameron: Right. So it works a little differently in America, though. I had suggested that she look into it. She did not qualify for it because she had a pre-existing health condition. It was not Alzheimer’s. It was something else. At that point, I should have said to her, “Okay mom, you can’t get this insurance. Let’s talk about your finances. Figure out what assets you have. Figure out how you would pay for this care if you ever needed it.” But I didn’t. I dropped the ball on that conversation, big time. And the thing is I should have known better because I am a financial journalist. I have been for a long, long time. But it just wasn’t even a conversation that I realized I needed to have, like you said. You don’t think about this. We’re so busy thinking about our own finances, teaching our kids how to be responsible with money. It’s natural not to think that we should be having this conversation with our parents. If we do think that we need to have it, then we might be afraid to have the conversation or we might think our parents are going to think we’re being nosy. And your parents might say, “This is none of your business.” But the truth is there will likely come a time when your parent’s finances are your business. Then may need your help as they get older, whether it’s financial help, care giving help. And, everyone dies. You’re going to have to deal with what your parents leave behind so it’s better to have these conversations before the health emergency or before they pass away so you have a plan, so legal documents are in place and you’re not scrambling to figure things out like what I had to do with my mom. If you wait until that emergency arises, of course, emotions are running high. You’re not thinking rationally. Your parents aren’t thinking rationally. And the last thing you really want to think about are finances. So having these conversations while your parents are healthy (ideally before they’re even retired) is going to make the conversation easier. Honestly, I know it sounds like such an awkward conversation, but if you’re doing it while everyone is in a good place, it’s a lot easier to have these conversations. It’s a lot easier to approach it without those emotions that are kicked into high gear if there is an emergency that is happening. So, yes, I wrote the book because I made the mistake and I don’t want other people to make that same mistake, too.
Tom: Going back to when you were a kid, what were money conversations like with your family? Did they talk about money much? Because my parents did not. So I’m thinking we’re probably in the same boat here.
Cameron: No. My parents did not talk about money. In fact, my dad told me it was impolite to talk with people about money. You never ask about someone’s income. My dad didn’t talk about his income. It’s interesting because my dad was an attorney and he was the breadwinner for our family. My mom stayed at home, took care of my sister and me. And I could see just by watching my mom that she was pretty frugal with her money. I guess initially out of necessity, when my parents were younger and my dad was making less money, my mom was really good about stretching the money. And even as my dad started making more money she was always just making really smart decisions with her money. Which I’m so grateful now, because fortunately, even though she could not get long-term care insurance, she had an inheritance from her parents that she didn’t blow. She and my dad got divorced. She could have taken that money and done whatever she wanted to with it, but she hung on to it. And it is that money that’s paying for her care now. But we just didn’t have those conversations growing up. Fortunately, my mom did not treat money like a taboo topic like my dad did so it wasn’t difficult for me to talk to her. My dad actually passed away at the age of 61 without a will. And he was in a second marriage and he was an attorney, too. So he should have known better. Maybe it just all gets back to not wanting to have to think about those things.
Tom: Yeah. We just recently had a Maple Money episode about having a will but we never covered that topic. Obviously, that’s probably one of the bigger conversations to have is to make sure everyone in your family has a will. Your parents and, obviously, yourself.
Cameron: Yes. You know, it’s so important to find out whether your parents have those important estate planning documents. The will is important. And the point of having that conversation is not to find out what you might be getting. It’s just to make sure that your parents have something in writing so they can spell out their wishes. This is what you want to let your parents know, “Mom and dad, it’s so important for you to put your wishes in writing so that we know what you want. So there won’t be any arguments when you’re gone over who gets what. There won’t be any fighting, hopefully.” Now, there’s no guarantee that with a will there won’t be any fighting. But at least the people who are left behind are going to know what you want. And in the case your parents, what they want. It’s also so important to have Power of Attorney. It’s someone you designate to make financial decisions for you if you no longer can. That’s so, so important. I would not have been able to step in and manage my mom’s finances if she had not named me Power of Attorney. If you don’t have that document here in the U.S., you have to go to court to become your parent’s conservator so you can make financial decisions for them. I think that’s even more important than the will. You had to be mentally competent to sign that document. So if you’re waiting until something happens where there is a stroke or whenever, it’s too late at that point. And from what I understand, you have something that’s similar in Canada, too.
Tom: Yes. It might be the same name or not. I can’t remember off the top of my head, but certainly it acts the exact same. I can’t remember what it was called, but it might be the same. But you’re right. That’s something where it makes so much more sense. That’s something that truly affects them. Certainly, if they if die without a will, that makes it tough on everyone else. But they can certainly understand that they need the Power of Attorney if they become incapable in that someone is able to take care of this and help them through all these decisions. Is that both finances and health?
Cameron: Well, we have two separate ones. You can have a Power of Attorney for finances and also a Power of Attorney for healthcare. My mother had named me both. My sister also. So when she has to go to the hospital for surgery, the first question they ask me is, “Are you your mom’s power of attorney? Are you her health care Power of Attorney?” If I were not, they wouldn’t even talk to me. It’s just so important to make sure your parents have these things in place so that there won’t be any surprises and everything will be set up in case you do have to step in and help them out, and that you can legally. Because the last thing you want to run into is having mom or dad in the hospital and they can’t pay their bills because they’re there in the hospital. And oh, my gosh, you can’t pay them either because you have no idea how they pay their bills or whether you’re legally allowed to do it for them. Having these conversations can help you sort all this out in advance. You want to make sure your parents know that you want to have this conversation because you’re looking out for their best interests and that you want them to be making these decisions. You want them to decide who they think is the best person to make financial decisions for them. Who is the best person to make health care decisions for them? You want to let them know the ball is in their court and that you’re not trying to take any power away from them. In fact, you want this power to be all theirs, to make these decisions, to choose the people they think will best fill this role. It doesn’t have to be me. It can be my younger brother. It can be my older sister. It can be my aunt and uncle. You just want to make sure everything is in place in case someone has to step in and help them out and actually do it legally so the bills get paid and the electricity isn’t getting turned off at their house while they’re in the hospital.
Tom: Yeah, yeah. It’s definitely just extra hassle you don’t need it at all. How do you bring up this conversation, especially if someone’s really kicking and screaming against it? How do you force the topic?
Cameron: Well, you don’t want to be too forceful. You have to remember that these your parents so you need to be respectful. I think this might resonate for people with kids; think about how you would want your own children talking to you. Even if they’re adults and you’re much older you still want them to treat you with respect. So this is the way you want to approach your parents, with respect. The conversation, like I said, is not about trying to figure out what you’re going to get. It’s also not telling your parents what they’ve done wrong. If you see that they’re making mistakes with their finances and you’re worried that you’re going to have to help pay for those mistakes, the conversation is not about that. At least not initially. There are a variety ways you can start it so that it’s a little bit more natural and not so awkward. A great way to do it is to use a story. Talk about someone you know who maybe benefited from having the conversation. Or someone you know who found themselves in a really bad situation because they had not talked to their parents and the parent died without a will and there was lots of fighting among family members. You could ask your parents about “what if” scenarios. I had a friend who actually did this after reading my book. She told me, “I asked my mom, who is single…” Her parents had divorced. She simply asked her, “Mom, what if something happened to you and you were in the hospital and I needed to pay for your bills for you? How would I do that?” And her mom said, “You know, I’m so glad you asked me that. I never even thought about that.” So she went home and started making a list of all her accounts and how to access them. It was that easy. Now, it’s not going to be that easy for everyone. For most people, I really do think if you have a good relationship with your parents, you let them know why you want to have the conversation. You use the story. You ask about “what if” scenarios. You talk about maybe some big life events. What does retirement look like for you? What sort of legacy are you hoping to leave behind? That can make the conversation happen naturally and they’re most likely going to open up and start talking to you. But there will be those parents who are going to push back because they think money is taboo or because they’re embarrassed about their financial situation. They don’t like the idea of giving up control to their kids, or maybe they just don’t like the idea of thinking about getting older and dying. Because with a lot of these conversations that’s kind of what they’re getting at. You’re getting older. I might have to help you. You’re going to die someday. Let’s hope things are in place so that it’s not going to be a mess if your parents are really reluctant. There are a couple of different things you can do. You can start by getting a third party involved. And maybe that’s a family member. Ideally, it’s a family member who maybe has had this conversation or is really on top of his or her finances. Maybe it’s a family friend you can reach out to and say, “Please encourage mom and dad to talk to us about this.” Maybe it’s a financial professional. If they’re working with a financial planner, an accountant, you could reach out to that person and say, “Hey, could you encourage my parents to give us some information about their finances?” Or encouraging them to meet with an attorney to get their documents updated, getting someone else involved. Your parents might be more willing to listen to them than to you as a child.
Tom: You mentioned earlier that your sister was also a Power of Attorney. What if your siblings have different ideas about how this should work? Maybe you both have different ideas about how you should even be bringing this up with your parents and coming up the next steps?
Cameron: Well, I do recommend that you talk to your siblings before you even talk to your parents so that you can get on the same page. It’s so important. And yes, your siblings might have different ideas about whether you should have the conversation. How do you start the conversation? So setting up a time to meet with them or have a call with your siblings to figure out who is going to initiate the conversation with your parents. Whether it’s one of you or all of you figuring out how you want to start the conversation. And then also talking about what roles you want to play in your parent’s lives as they get older. So that when you go to them you can say, “Hey, mom and dad. We’ve been talking and we want to talk to you about your finances just to make sure we have a plan so we know what you want. We’ve been talking about what we can do, what we’re willing to do…” Just to let them know that you guys are already on the same page. That can make it easier for parents to open up.
Tom: Another thing you brought up earlier was the idea of having these conversations so that things aren’t a surprise. What about when it comes to something like a will? Maybe it is a personal opinion, but do you think people should know what’s in that will? I guess it depends what’s in the will if it’s going to cause a problem or not. But it seems like a terrible time to surprise anybody with the contents of a will once that person’s gone.
Cameron: Well, oftentimes parents can be reluctant to have that conversation about what’s in their will because they don’t always divide things up equally and they don’t want to tell their kids this. The main thing you want to find out is if they actually have a will and where is it? And if you’re the executor of the will, you want to know if you’re the person who’s going to be in charge of making sure everything that’s to be distributed, you need to know what your parents have. But this really comes down to your parents comfort level. I would say don’t push them too hard to reveal who’s getting what. The key is just to see if they have it in writing. Now, your parents might say, “Yeah, we do and we’re splitting everything up evenly.” Or, “Hey, we’re giving more to your younger brother because we feel like you’re doing well financially and your younger brother needs help.” You have to remember that this is your parent’s money. And they get to make that decision. It might seem unfair to you if they’re not splitting everything up evenly, but it’s their decision so you shouldn’t be trying to influence it. So don’t push to find out what’s in that will. If they don’t seem to be willing to talk about it, just find out if they actually have a will. And if they don’t, encourage them to have a will drafted as soon as possible.
Tom: With everything here, it seems like you definitely want to tread lightly. It’s it is your parents. It’s family. You want to have these conversations but you don’t want to start a new problem. Am I kind of getting the right idea here, that this could kind of go in a bad direction if you if you don’t handle it properly?
Cameron: I think it could. It really depends on the relationship you have with your parents and how your parents view money. Some people can be very direct with their parents and just simply say, “Hey, mom and dad, let’s sit down and have a conversation about your finances. We don’t have to do it all at once. We can do it over several meetings. This is why I want to have the conversation. This is what I hope to get out of it.” And they say, “Sure, let’s do it. That’s a great idea.” But if your relationships are more strained, you’re already starting out at a disadvantage because it is going to be a little bit more difficult for you to talk about a sensitive subject like this. And that means maybe you’re not the right person to be having the conversation. Maybe it’s a sibling. Maybe it’s even getting your parents siblings to talk to them to get some information, and get your parents to write down information for you. You might not be the right person to have this conversation. It’s something you need to think about before you even try to have the conversation. If you do come into the conversation trying to tell your parents what to do with their money, pointing out mistakes they’ve made, then yes, you are certainly going to get pushback. They’re not going to like that. And who can blame them? They’re going to be put on the defensive so they’re not going to have the conversation. Even if you have that great relationship with your parents, again, be respectful. Even in good relationships talking about money can always be a little bit difficult. And the point of this is not so much to get dollar amounts out of them or how much money they have in the bank account or how much they’re saving for retirement. The key is just to find out where they bank. And if something happens to them, how can you get access to those accounts to make sure their bills are paid? What sort of insurance policies do they have? What does their retirement look like? Are they planning on staying in their house or downsizing? What sort of long-term care would they want if they ever needed it? You’re talking about bigger picture issues rather than the real details. Now, of course, the more details you can get, the better. But they don’t necessarily have to tell you this. You can ask them to write it down for you and put it someplace safe, then tell you how to access it when you need it.
Tom: Yeah, that sounds like a lot of this is similar to having the same conversation with your spouse about anything too. We just mentioned this in a past episode about knowing where to get to the bank accounts… You always assume nothing’s going to happen to you. I guess it goes the same for their parents, too. They feel like they don’t have to tell you this because it’s just not a pressing need. But obviously it’s going to come.
Cameron: Right. And you never know when something is going to happen. And there’s a good chance that it will. The other benefit of having these conversations is that it can actually force your parents to share information with each other because not all couples do that. It might be that one person’s managing the household finances and the other person’s in the dark. Then suddenly that person dies and the other person is left behind not knowing how to pay the bills or how to access the bank accounts. So the added benefit is that you can get your parents to start talking too and making sure they have a plan if something were to happen to one or the other of them.
Tom: In a lot of cases it’s probably one of the easiest ways to actually bring that up. If both your parents are still around, you can have that conversation and kind of take yourself out of it a little bit. You can make it more about the two of them. Obviously, you’re still making sure that they’re taking the right steps. If they both know these things then the information will probably filter down to you.
Cameron: Sure. And maybe you’re closer to your mom, for example, so you go to mom first and say, “Hey mom, if something were to happen to dad, would you have easy access to the bank account? Would you know how to pay the bills?” You get mom starting to think about this and then she goes to dad and says, “Hey, we need to have a conversation.” Or maybe you start with dad. Whichever parent you’re closest and feel might be more receptive. Now, you don’t try to pit your parents against each other. That’s not the goal here. It’s to get them talking and get that information out.
Tom: How do you suggest getting the information? Do you just ask them to make a list of bank accounts and maybe store it away somewhere? Or is this just a verbal conversation> What is the best strategy to actually gather all this information?
Cameron: You can start just by making it a conversation. You don’t have to get all this information all at once. But ideally, you want to either take notes during that conversation or, like you said, get them to make that list. They can type it up on their computer and put it in a Dropbox file so that you can have access to it. Or if they don’t feel comfortable giving you that access now, just tell them to keep the list someplace safe and tell you how to access it. It’s not doing anyone any good if you can’t get to that list of all their accounts. And let them know that the more information they can give you, the better so when something happens, you or your siblings would be able to help you. And also pointing out too, if they’re so not quite on board with the idea of making the list of other accounts, just say, “When you’re no longer with us, we want to make sure that nothing flies under the radar. We don’t want to end up missing out on accounts that go unclaimed and get turned over or shoeboxes with stock certificates under the bed. You hear stories about all the time. They get tossed out because no one knows they exist. We want to make sure all those things you worked so hard for, we actually know about. And if this is something you want to pass on to us, we want to make sure we have a good accounting of everything so that we don’t miss anything.”
Now that you’ve gone through this personally and wrote the book literally, how would this affect how you deal with this with your own children? Would you take that conversation out of their hands and open up that money conversation?
Cameron: Oh, yeah. My husband and I have been talking to our kids about money from the time they could talk so it’s not a taboo topic in our family at all. We talk about money all the time. Now, they’re still relatively young. My oldest is 15. I’m not giving her all the specifics like, this is my bank account number and that sort of thing. But we’ve already had discussions about our wills with them. They know we have wills. We’ve named guardians for them. We have even told them what our final wishes are and what we want done with us when we die. And they’re like, “Oh, don’t tell me this.” And I say, “Look, I’m telling you, you need you know. You’re young but still you need to know because you never know when something can happen.” We’ve told them we don’t expect them to have to take care of us as we age. We’re trying to put things in place so that burden is never going to fall on them. Of course, if I end up with Alzheimer’s like my mom, I would hope that at least one of them would step up and manage my finances the way I do for my mom. But I don’t expect them to give up their jobs and take care of me or anything like that. So we do have those conversations. It’s so important too, especially if you have children of your own and have to get involved with your parents care giving which can be a full-time job if you have to take off work to care for a parent. You don’t want to jeopardize your own finances. You have to remember that your finances have to be the priority, especially if you have kids who are counting on you for support because you don’t want to put them in a situation where they’re going to have to turn around and jeopardize their finances to take care of you. And so as difficult as it might seem, some of these conversations with your parents might be along the lines of telling them, “Look, this is what I can do to help you out if you ever need it, but this is only as much as I can do because I can’t give up my job to help care for you. I can’t let you move into my house because we don’t have enough room.” Whatever your situation is, the key is that your finances still have to be a priority as much as you might want to help your parents. You have to remember that you can only do so much and you don’t want to put yourself or your kids in financial jeopardy.
Tom: Great. Is there anything we missed in this conversation? Have we covered all the important parts?
Cameron: Well, we’ve covered a lot. Talking to your siblings, making sure to let your parents know that you want to have this conversation out of concern for them. And for being prepared in ways that you can start the conversation and getting that third party in to help as well as asking them to make a list if that’s easier for them. So yes, we’ve definitely covered a lot. I hope people can get over any fears they might have of having this conversation because I can tell you the consequences of not having it are so much worse. And really, the sooner you can have the conversation, the better it’s going to be.
Tom: Yeah, for sure because you never know when something can happen. Can you let people know where they can find you and tell them about the book as well?
Cameron: Sure. You can find more information about me at cameronhuddleston.com. And there is a link on my website to the places that sell my books such as Amazon. I’ve also got some free resources that are related to the book that you can download, including a fill-in-the-blank financial inventory you could print out and give to your parents. And links to all my social media accounts are on cameronhuddleston.com too. And the book is Mom and Dad, We Need To Talk – How To Have Essential Conversations With Your Parents About Their Finances.
Tom: Great. Thanks for being on the show.
Cameron: Thank you.
Thanks Cameron, for showing us why it’s so important to talk with our parents about their finances and for sharing tips on how to get the conversation started. You can find the show notes for this episode at maplemoney.com/cameronhuddleston. Or, head over to maplemoney.com/show to find the show notes to all the past episodes. I want to give a big shout out to the Maple Money Show Facebook community. love to hear from you over there. It’s a great place to ask questions or share a recent money win to encourage others. If you haven’t already become a member, head over to maplemoney.com/community to share with the group. And as a reminder, please tune in next week as Tim Nash joins me to discuss socially responsible investing. See you next week.