Rashomon? Clients and their children have different vision of parents' retirement

Survey suggests advisers should hold discussions with both camps; few do

By Liz Skinner

Nov 14, 2012 @ 1:14 pm (Updated 1:30 pm) EST

Retirement

Financial advisers can help their clients — and themselves — by bringing in the adult children of their aging clients to discuss retirement, estate planning and the parents' future care.

A Fidelity Investments survey of parents and their children age 30 and up found that few families have discussed these important matters in detail. The survey also found vast differences in how the two generations see the elders' financial future playing out.

About 97% of respondents disagree on whether children will care for parents if they become ill, according to the survey of 152 parent-child pairs. About a quarter of the children said they believe they will have to help their parents financially in retirement, while 97% of the parents said they won't need help.

One thing the two generations largely agree on is that they'd rather talk about the issues with a financial adviser.

About 68% of parents and 60% of children said they feel more comfortable talking with a third-party financial professional than with one another alone, the survey found. The results also showed that parents and children who have discussed estate plans are significantly more at ease about their financial futures than those who haven't.

Bringing the two generations together to hash out these important topics allows advisers to provide clients with comfort and reassurance, said Larry Sinsimer, senior vice president of Fidelity practice management.

“Bringing in an unemotional, detached person offering advice seems to make it easier for everyone to open up and have the conversation,” he said.

The sessions also give advisers an opportunity to reach out to the next generation —which has been a challenge for many — and develop a relationship with those who will decide where the money goes in the future, Mr. Sinsimer added.

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