Provide Parents Help While Taking Care of Yourself

Beth Schanou, Senior Wealth Planner


Finances can be difficult to talk about – especially with your parents when they need your financial help.

While statistics show a growing number of adult children are still getting financial help from their parents, AARP research found that among adults age 40-64, 32% have provided financial support to their parents and 42% expect they’ll be providing support to parents in the future.

That same research found that 54% of those providing help had given $1,000 or more to a parent, while 20% have provided $5,000 or more. The research found that the money was primarily used for basic necessities like groceries.

These are significant expenses, and those who said they were helping their parents reported that it put a strain on their own finances. Maybe you’re among that group who might need to provide financial support to your parents. It’s important to do so in a way that doesn’t hinder your future plans and responsibilities.

In this article, I’ll give you an overview of how to approach providing help while still taking care of your own finances.


Gathering All the Information

It’s important to understand the scope of your parents’ financial situation. What exactly do they need help with? Is this a short-term problem, or is it ongoing? Are your parents making poor decisions, or do they just need help with a medical bill?

If your parents need help and you approach them about it, you could face a hurdle in gathering all the correct information. This step will likely be easier if your parents approach you for help. But either way, you need to understand the magnitude of the help they need so you can properly address it.

The right approach can help with this information gathering: “I really want to help you. In order to help you, I really need to understand what the situation is.”

As financial planners, when we’re working with families, our effectiveness is limited if the clients don’t provide us with the necessary information. The same is true if you’re supporting your parents – the more information you can get, the better you’ll be able to help. Get a full picture of their income, assets and expenses.

Ensure your parents know you’re on their side. If they’re reluctant to give you the necessary information, be sure to emphasize this to them by reiterating, “I can help you better if I know more.”


Budgeting for Help and Pitfalls to Avoid

When we learn our parents need help, we might just jump in and provide it because we don’t want to see our parents struggle.

But we have to be more strategic. Once you know the situation and how much help you need to provide, you can then look at your own finances and see if you have the capacity to help. If you have a spouse or partner, you need to check with them to ensure you’re on the same page so it won’t cause household or relationship issues.

If you’ve determined you have the capacity and your partner is on board, then it’s time to identify what you can afford to do. Can you cover individual expenses, like groceries or bills? Can you provide help on a regular basis, or are you only able to do it for one or two months? Once you determine your capacity and the frequency, you can add it to your budget.

If it’s a one- or two-month expense, you can look into providing some gift cards to grocery stores. If it’s a regular expense, look at your budget and see what you feel like you can trim. Or you can redirect funds from entertainment or other discretionary spending toward helping your parents.

Oftentimes, people take fairly drastic measures to get financial resources for their parents. But you want to avoid certain pitfalls, including:

  • Co-signing on loans and being a guarantor of medical bills. If you do this and your parents are unable to pay or they stop making payments, it could adversely affect your credit and you could be responsible for the debt.
  • Getting into debt. Don’t take out loans in your name to provide financial help for your parents.

Working your parents’ expenses into your budget is a matter of how much you’re willing to sacrifice and understanding how long you’ll need to help. Then you can fully evaluate your options and make more educated decisions about what you can really do.


Ideas for Generating Cash for Your Parents

If possible, there are several things you could do to help your parents generate cash to fund some of their expenses. Here are some paths to explore:

  • Do they have a home that can be downsized? You could look into buying the home from them, or selling it and helping them move into a smaller home with a lower mortgage payment. This also brings up the conversation of whether they should move in with you at some point.
  • Selling things they don’t need anymore. You could hold a garage sale, or list items on Facebook Marketplace or Craigslist.
  • Depending on your parents’ age and physical capabilities, they could consider a side gig like DoorDash.
  • If they are crafty or artistic, they could consider selling their wares.

These are just a few ways to help them get more financial resources, which can be especially helpful if your parents express being too proud to accept your help.


Communicating with Your Family and Managing Emotions

You can certainly get into a circumstance where you don’t fully understand how much help your parents need, and they might keep coming back asking for more. The stress could build,  especially if you have siblings and you’re the only one helping financially.

Communication is essential. Earlier, we talked about how you need to communicate with your parents and your spouse, but it’s also important that you’re able to communicate with your siblings. You don’t want to feel resentful of either your parents or your siblings.

Communication in situations like this is also difficult because there is so much emotion tied to money. And this situation, in particular, could be confusing because as kids, we grow up being financially dependent on our parents. Now we’re in a situation where our parents increasingly need our help.

If you find it difficult to manage these conversations, you can start by asking your financial professional if they have the behavioral finance background to facilitate the conversation. If not, you can find a financial therapist who could help facilitate these discussions. Either way, a professional can also help identify whether decision-making is problematic for your parents and whether you need to step in and start managing those decisions. The Financial Therapy Association has a tool to find a financial therapist who might be able to help.


To Sum It Up

None of us wants to see our parents suffer, and if they need help, we’ll likely provide it. But you can do it in a way that doesn’t negatively impact your own finances if you work with a financial professional. Get in touch with yours today.


Beth is a non-registered associate of Cetera.

Get in Touch

In just minutes we can get to know your situation, then connect you with an advisor committed to helping you pursue true wealth.

Contact Us

Stay Connected

Business professional using his tablet to check his financial numbers

401(k) Calculator

Determine how your retirement account compares to what you may need in retirement.

Get Started