Financial Help for Elderly Parents

Your Money

With Cherryl Hanson-Simpson

Wednesday, August 06, 2014

Print this page Email A Friend!

Last week we examined some of the considerations that adult children may have to face when dealing with parents who have financial difficulties. Assisting your parents with their money needs when they are unable to cope requires a lot of patience and diplomacy, as well as financial astuteness.

Even if your parents have been excellent stewards of money throughout their lifetime, as they get older, you may need to become more involved in helping them with their finances. Let's look at some of the areas in which your elderly parents may require your support in their retirement years.

Budgeting for spending

At every stage of your financial life cycle, it's important to know exactly how much money is required to pay all your bills. Budgeting helps you to be aware of your expected expenses and earnings; and this habit becomes even more critical for persons who are retired or have to live on fixed income sources.

You can help your elderly parents to plan for their spending by using a simple budget form. Download a retirement lifestyle budget at which lists the expenses that they may incur, and allows them to see if their retirement income will be enough to meet their needs.

Encourage them to reduce their utility costs by implementing energy-saving strategies, and help them to lower their grocery bills by combining your purchases at wholesale outlets. Look out for places that offer senior citizen discounts, and point them to these locations for their shopping.

Managing health costs

One of the expense items that may increase during your parents' senior years is health care. If not managed properly, medical costs can take up a significant portion of their funds. However, there are various options that can help them to control their health-related spending.

They can register for the Jamaica Drugs for the Elderly Programme (JADEP) at the National Council for Senior Citizens or the NIS office in each parish capital. Government pensioners can also utilise the NI Gold Health Card, while the National Health Fund provides lower-cost drugs for chronic conditions.

Understanding inflation

Preparing a current budget is not enough, as your parents also need to know how well their money will last throughout their retirement years. Many retirees are not aware of how inflation adversely affects their savings and pensions, so you can help them to estimate how costs will increase over the years.

Get help from a representative at a financial institution to work out how long their retirement funds will last if their annual spending needs are increased by the average inflation rate each year. You can also search online for retirement calculators which can provide you with this information.

Maximising retirement funds

Elderly persons often have multiple accounts that are not best suited for their retirement cash needs. Your parents should look to consolidate their accounts to provide a consistent income stream. They may also need to sell assets such as land or stocks to ensure that they will have enough cash flow.

To combat the effects of inflation, they should also ensure that their retirement accounts earn the best returns. Opt for tax-free accounts and secure investments that can supply long-term income, such as bonds. Get guidance from an investment advisor to help them make the right investing decisions.

Increasing retirement income

Your parents will need to have enough money flowing in over several years of retirement, and their pensions or investment income may not be sufficient. Therefore, you may need to show them other ways to generate money so that they won't have to lower their standard of living in retirement.

Some earning options they could consider are renting out sections of their home, turning a hobby such as gardening into a small business, working part-time at their former employers, providing consulting services in their area of expertise, or selling products in a direct marketing business.

Planning for their passing

Inevitably, we will all have to leave this earth; and it's essential that you help your parents to prepare themselves for this transition. This topic may not be that easy to bring up, especially if your parents don't trust other people with their financial matters or if they don't like to discuss death.

Explain that estate planning allows them to pass on their possessions according to their wishes. If they give no instructions for transferring their assets, then the government will have to make that decision; and no doubt they would not want to leave it up to strangers to share up their property.

While they can prepare a simple will on their own, it might be prudent for them to get legal assistance to ensure that the documents are accurate and binding. They may also need to get advice on ways to reduce their estate tax liability by establishing joint ownership for their property.

As you make efforts to assist your elderly parents with their finances, ensure that you always treat them with respect. Don't let them think that you are trying to control their lives; just make practical suggestions and allow them time to determine the wisdom of your financial advice.

Cherryl is a money coach, business mentor and founder of Financially S.M.A.R.T. Services. Her upcoming book, "The 3 Ms of Money" will reveal all the secrets she learned about financial success. Read more on money and business matters at and Email comments to




1. We welcome reader comments on the top stories of the day. Some comments may be republished on the website or in the newspaper � email addresses will not be published.

2. Please understand that comments are moderated and it is not always possible to publish all that have been submitted. We will, however, try to publish comments that are representative of all received.

3. We ask that comments are civil and free of libellous or hateful material. Also please stick to the topic under discussion.

4. Please do not write in block capitals since this makes your comment hard to read.

5. Please don't use the comments to advertise. However, our advertising department can be more than accommodating if emailed:

6. If readers wish to report offensive comments, suggest a correction or share a story then please email:

7. Lastly, read our Terms and Conditions and Privacy Policy

comments powered by Disqus



Today's Cartoon

Click image to view full size editorial cartoon