In many families,money issues between grown child and aging parents are the most sensitive of all,since everything that must be resolved involves not only finances but emotions as well.Money issues between grown child and aging parent can invole:
Transfer of wealth from parent to child through gifts and inheritance.
Transfer of control of assets from parent to child-ranging from cherished piece of family jewelry to ownership of the family house.
Transfer of the ownership of a family business or farm.
How aging parents will be supported in their last years and who will pay for that support.
What say grown child will have over the financial affairs of their aging parents and what say aging parents will have over the financial affairs of grown children.
Those issues can be contentious enough to start fights between parents and child,or brother and sister. If a family business is passed equally to all the children,control is divided and the business can quickly fail.If the business is passed only to the eldest child, younger brothers and sisters me be cheated.
The same is true of all assets. A parent may decide that he or she loves all the children equally,so the family home is left equally to all children.But that’s a scenario made for disadter since decisions on everything from whether to sell the house to when to get the rooof fixed can’t be made until all sibling agree.One child may want to cash in immediately by selling the house. Another may regard the home as sacred-“where we were born”-and refuse to accept even above-market offers for the home.
But every grown chhild/aging-parent financial issue has a strong emotional element to it,as well. Grown children may think they are being rational in arguing about how to divide up an inheritance. In fact,they are dredging up conflicts from childhood over whether mom likes Vanessa or Bill the best.
One grown child may bear the major responsibility for caring for the aging parents-sometimes even remaining single to serve as primary caregiver to the parents. That care-giving child may become angry-especially if the other siblings don’t compensate by picking up most of the cost of providing that care. Often, one,or even all,the grown children will be caught in the middle-trying to raise their own families while also helping to support their aging parents. The term”sandwich generation”has been coined to refer to people with both children and parents to care for.
A great many financial matters must be worked out between grown children and aging parents. Unless they are worked out intelligently,and with outside help brought in when necessary,the result can be clashes and conflict that poisons relationships that ought to be kept close and loving.
Something to think about:
What grown children need.
What parents need.
Working it out.
Passing Along a Business or Some other Asset
How to structure the gift.
Specific issues relating to a business.
Giving up control after giving it away.
Caring for Aging Parents.
If you are the grown children, how much do you really know about your parents finances?
If you are the aging parent, how much do you really know about all of your childrens’finances?
For children. How much do your parents have?
For parents.How nuch do your children have?