Ah, family gatherings. Whether it be a year-end holiday dinner, a spring wedding or a summer cookout, these opportunities for multiple generations to gather and catch up are priceless. And in more ways than one. Along with providing forums for attendees to discuss exciting travel plans or share adorable pet pics, festive gatherings can also paint a perfect portrait of family finances.
For example, look to one side of the dinner table and you're likely to find the parents and grandparents. Some may be in what's considered middle age while others are older.
All have financial concerns related to aging, including maximizing tax-savvy retirement contributions or managing how they spend their retirement savings. Now is also the time for them to create, or review and update, key documents such as powers of attorney for property and health care, along with wills and trusts.
Middle-aged family members with aging parents should also consider what they'll do if one or more of those parents suffers a serious medical issue. Will they accommodate them in their own homes? What are the local assisted living and nursing home options — and the associated costs?
Turning to another side of the table, you might find college-age children home on break or in between semesters. These energetic young people have more than likely already impacted family finances while paying for their educations, but the challenge doesn't end there.
Many graduates return home saddled with considerable student loan debt. Often, the plan is to live "back in the nest" until they can find a good job and afford a place to live. But these ostensibly temporary stays often stretch on and on. Parents should work with their soon-to-be college grads to get an accurate projection of how much debt their children will be carrying and their plans for after graduation.
Many family gatherings also have a kids' table. You know the one — small, often loud, crowded and cluttered with plastic cups prone to spillage.
There are financial issues to ponder here, too. Young children represent teaching opportunities. How can you teach them to live within a budget, amass savings, invest wisely and donate to charity? Their parents also need to decide whether and how to fund their college educations — all while those same parents save for their own retirements.
To be clear, family gatherings aren't the ideal places to resolve or even raise complex financial issues. But, looking around the room at your next one, try to see the big picture of the various issues that most affect your family's finances. Your CPA and other professional advisors can help you address those issues and plan effectively for everyone's future.
Get in touch today and find out how we can help you meet your objectives.
