Taking Care of Mom and Dad: Changing Face of Retirement
Another important thing to remember is that retirement -- at least the version of it that dominates commercial breaks during the evening news -- is a relatively recent creation. Historically, people's roles in family or other community changed as they got older; but they didn't bolt for Leisure World and 20 years of golf cart races. The elders remained involved in the life of the village or clan.
Americans, as a culture, may be heading back in that direction. Through the 2000s and 2010s, American retirees will continue to retire to a higher quality of life than those who've retired before them. But, starting in the mid-2010s, financial pressures on the Social Security system in the U.S. will probably start reducing the benefits available to able-bodied elders. This will come as a shock to the more than half of all Americans who've never even sat down to run the numbers about how much money they'll need to live.
Some things to keep in mind:
- Set spending goals with your parents;
- Don't agonize over specific investments they made or didn't make;
- Evaluate the state of their tax-advantaged retirement plans, if any;
- Realize that their expenses will change; and
- Help them to accept their potential need to work in retirement.
In the end, retirement is a critical test of your parents' attitudes about money because it's usually their largest opportunity to plan carefully and act selflessly. You can teach your family members a lot -- by lesson and by example -- from the way you handle money and your parents' own old age.
