5 tips for helping your aging parent protect their assets during retirement

Retirement is an exciting new chapter in your parent’s life, full of opportunities to explore their passions, form new relationships and maintain an active and healthy lifestyle. The last thing you want to have happen, though, is for an unforeseen financial crisis to jeopardize their retirement.

As a child of an aging parent, there are many steps you can take to help safeguard their assets for this next stage of their life. Before you jump in, though, have an open and respectful conversation with them to let them know that you would like to help them make sure their finances are in top shape for retirement, or, wait for an invitation for help. If they are open to your help, follow these tips:

1. Familiarize yourself with their investment portfolio 
To protect your parent’s assets, you first need to understand what they are.

One of the first steps is “getting some sense of where your parents hold their assets, what types of assets they have, and also helping them look at the sustainability of any income that they are drawing from their portfolios,” says Christine Benz, director of personal finance for Morningstar.

If you notice areas where you think a change in their approach could be beneficial, don’t jump in without discussing these ideas with your parent first. And even still, make sure you respect their final say.

2. Review tax or debit risks
In addition to their investment portfolio, you should also review any retirement savings and additional assets that your parent has, taking special care to note any tax or debt liabilities, recommends Life Health & Wealth. After reviewing this information, estimate the need for life insurance, and check whether your parent’s current policy is substantial enough to cover these needs or should be updated.

There are some important steps you can take to help protect your parent’s assets.

3. Meet with your parent’s financial advisor
To provide the greatest protection around your parent’s assets, everyone needs to be on the same page. After getting the OK from your parent, meet with their financial advisor to make sure you have access to all the materials, documents, portfolios and accounts your parent is involved in. This is also a good way to make sure any forgotten investments or other deals from long ago are brought to light.

4. Make sure the essentials are in place 
Protecting their wealth for retirement also means planning for unexpected expenses and emergencies. When meeting with their financial advisor and talking with your parent, make sure they have an up-to-date will and designated power of attorney, recommended Benz.

5. Settle house matters
If your parent is considering a move to a retirement residence, it’s important to make sure financial matters related to their home are settled. As Blue Shore Financial notes, you can sell the home and have them benefit from the equity. Talk with your parent and their financial advisor to determine the best course of action.

If your parent is interested in exploring their retirement living options, but you’re unsure if they can afford the lifestyle, use Chartwell’s helpful Budget Assistant. The tool helps to identify current living expenses, and offers an estimate of projected income from the sale of assets, including a home or condominium. These calculations can also help evaluate the average savings your parent may realize compared to their current living arrangement.