If you didn’t grow up in a financially transparent household, it can be awkward to discuss money with your parents. However, having those conversations can benefit both of you. Your parents are further along in their financial journey than you and have wisdom they can pass down.
You can learn from their financial mistakes and triumphs, which can help inform how you handle your finances. Even if your parents are great money managers, they may be able to learn a thing or two from you.
It’s also important for you to know how much your parents have saved for retirement. If they haven’t planned for retirement or end-of-life expenses, it’s good to have that information sooner than later. That way you can factor them into your long-term financial plans if you decide you want to help them out.
Although my parents and I didn’t discuss their money situation very often during my childhood, we talk about it all the time now. Here’s how my parents and I got comfortable with chatting about finances.
Be Open About Your Finances
One way to help your parents open up about their finances is to start talking about yours. Once I became an adult and had my own financial wins and struggles, I shared them with my parents. They’d often chime in with their experiences to encourage me and make me feel better about my situation.
Finances are pretty private and hard to talk about. But being vulnerable and willing to discuss your finances with your parents can help you build trust with them. Eventually, they may be comfortable opening up as well.
Don’t Judge Your Parents
Whenever your parents share financial details with you, try your best not to judge them. We’re all in different places with our finances, so respect where your parents are in their financial journey.
If they don’t have retirement savings or are in debt like my parents, you don’t have to pretend like it’s not a problem. But don’t dwell on the negative or act condescending toward them, even if you think they could’ve handled their money better. Ask them what you can do to help and focus on solutions.
No matter how old your parents are, their finances are not a lost cause—they can still turn things around. I’m cheering on my parents boost their bad credit scores and pay off thousands of dollars in debt in their sixties.
Share Your Financial Knowledge
I’m a personal finance writer, so I know a fair bit about investing, credit cards, and mortgages. Because I keep my parents updated on my financial plans such as paying off my home early, they realized I knew a lot about personal finance. Eventually, they started coming to me for advice.
My parents’ main concerns were paying off their debt and rebuilding their credit. I shared some ways for them to boost their credit scores, such as using Experian Boost and keeping their credit utilization ratios low. After working on their credit for about a year, my dad’s FICO score is now at 620 and climbing. My parents are even thinking about buying a modest home in the next year or two to prepare for retirement.
Learning from each other is one of the biggest benefits of discussing finances with your parents. My dad has been in sales for 30 years and has taught me how to market my freelance services and handle client interactions better. My mom has helped me with meal planning and grocery shopping on a budget. I’ve been able to help my parents with some of their weak spots like budgeting and understanding how the FICO credit scoring system works.
We’ve been able to shore up each other’s weaknesses by learning how to discuss money, and we’re all better for it.
Gain Peace of Mind
Most of all, I’ve gained financial peace of mind by talking to my parents about money. I used to worry that they were unprepared for retirement. I feared I wouldn’t be able to afford to help them because I wasn’t including them in my financial plans.
Now I know the main obstacle they need to overcome before they retire is debt, which they’re paying off pretty quickly. Between their pensions and social security checks, they’ll have enough income in retirement to be comfortable once they’re debt-free.
I sleep better at night knowing they’ll be set for retirement when the time comes. But if they weren’t financially prepared, I’d be able to factor them into my plans because we discussed financial matters early.
Wrapping Up
You don’t want to be caught off-guard by your parents’ money situation. Mismatched expectations can cause financial problems for both of you down the line. So even though it can be hard to get the ball rolling, it’s important to start talking to your parents about money as soon as possible. That way there are no surprises and you can all get on the same page.
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Vicky Monroe is a freelance personal finance and lifestyle writer. When she’s not busy writing about her favorite money saving hacks or tinkering with her budget spreadsheets, she likes to travel, garden, and cook healthy vegetarian meals.
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