Your roles and responsibilities change as you grow older, as do your family circumstances. Planning on taking care of your family takes on a different purpose as you age: instead of being concerned with feeding a family and paying school fees, you need to think about supporting your children in buying a house and consider the implications funeral costs may have. A little bit of financial planning will go a long way in ensuring your family is financially secure.
Putting money aside
Young adults with busy lives, limited income and growing responsibilities can find it difficult to respond financially to a crisis. This is where you as the parent can step in, by helping out when the unexpected happens. Set aside some money you can make available to your children when they need it. If you start saving up long in advance, this pot of money can also help your children to afford the deposit on a house – the housing ladder is increasingly difficult for young people to get a start on.
It is also worth remembering that as you grow older you are more likely to encounter unexpected medical expenses, or periods of illness preventing you from attending work. Having some savings will reduce your reliance on your children when you are in a financially difficult position.
Plan on funeral expenses
It is never a pleasant topic to consider, but funeral expenses are an inevitable element of growing older. However, it is not you who will be asked to pay for funeral expenses, and in large cities such as New York, Atlanta and Dallas, funeral services can be very expensive, adding a lot of strain to what is already a difficult situation.
Instead, make use of one of the many funeral policies on the market that pay out as soon as funeral services are required. An insurance policy makes sure your children or remaining spouse are not burdened with spending funds on a funeral before your estate is anywhere near being settled.
Write a will
It is quite common for people to pass away without having in place any directions on their last wishes. If you pass away without having made a legally valid will, “intestate”, your assets will be divided according to the intestacy laws of the state where you live. The delays in processing the estate of a person who dies “intestate” can be significant and can cause a lot of problems if, for example, there are ongoing expenditures your spouse is responsible for.
The lack of a will also means you have no control over how your assets are distributed – you might feel that some family members are more in need of assistance than others. An incomplete or contestable will should also be avoided otherwise your remaining family members might end up squabbling in court.
Planning is important
Keep in mind that the life events you face as you grow older change, as do the circumstances of your family members. You need to adjust your financial planning accordingly – by saving money, taking out insurance as needed and by putting in place a final will and testament. Think through these changes and put in place the changes you think you need to make to adequately take care of your family as you grow older.