April 26, 2017

WTOP Interview: Aging Parents, Aging Us: How To Prepare for the Next Phase in Life Part I

LISTEN NOW: Aging can be an uncomfortable topic, but preparing for it can ease fears for parents and adult children.
Dawn Doebler, MBA, CPA, CFP®, CDFA®, Senior Wealth Advisor

Read The Article: Aging Parents Aging Us: Helping Parents As They Age

INTERVIEW TRANSCRIPT:

SHAWN ANDERSON: Aging is not a topic many of us are comfortable with, but preparing for the next stage in life can ease fears for both parents and you the adult child.

HILLARY HOWARD: In the first of a two-part series ''aging parents, aging us'', Dawn Doebler Senior Wealth Advisor of Bridgewater Wealth in Bethesda and cofounder of Her Wealth, joins us to help us all handle this really delicate and important topic. Dawn, great to see you!

DAWN DOEBLER: Yes, thanks for having me back.

HILLARY HOWARD: This really is a huge hot topic for so many people; our parents are living, we're longer living longer, some of our parents are in their 70s and 80s. What are some of the reasons we need to address this topic with them?

DAWN DOEBLER: Well Hillary, a lot of our clients are affected when their parents' health decline, they may need to leave the workforce earlier than expected or many times use their own resources to help pay for care, so we think it’s important to have this discussion early and often so that you are prepared. If you don’t have that, what tends to happen is that families get into a health crisis and then they’re being forced to make decisions in that crisis which usually are not optimal decisions. Also, if you don’t know your parents' wishes, then there might be other people making decisions that wouldn’t be in line with what your parents would want. We’ve talked about this, there’s an increase in gray divorce and the results of that as many parents are single and old age and that means there’s a greater incidence of adult children having to take care of their parents because they are single, the parents don’t have a spouse there to either take care of them or to make decisions.

SHAWN ANDERSON: We know these conversations are vital, but having that conversation with one or both parents, that can really be tough. Are there things you can do to open that discussion up?

DAWN DOEBLER: Well, yes Sean. As you said, it can be a difficult conversation and I really would encourage your listeners to read the article, there are lots of information in there, but one thing we wanted to say is, there’s kind of role reversal that begins to happen at this stage of life and that can take time for people to get used to, so this really is a process. It’s not usually a one-time conversation and one of the best things you can do is to be careful about the way you open the conversation with your parents. A lot of families, money talk is taboo and if that’s the case in your family you need to be aware of that and I’ll consider that when you’re talking to the parents. And then also we would suggest that you consider the dynamics of aging, many parents feel they are losing control and to kind of balance that they often try to become more secretive about their money. We also have a lot of wealthy parents express to us or are concerned about revealing their level of wealth; they think that might cause their children to not be motivated to continue to create wealth. So it’s really about considering what your parents might be going through, having a series of conversations, it’s not a one and done and realize that it’s really a process to get the conversation going.

HILLARY HOWARD: What happens when your folks are completely resistant to this idea at all?

DAWN DOEBLER: Well, Hillary that certainly is the case with many people, so we have some suggestions:

·      First of all, you can ask is there anyone mom and dad that you had this conversation with who we could contact if something happen.

·      You could ask them simply, do you have a long-term care policy and where is it located in case we need to access that. We have a great book with us today, it is called the ''other talk'' written by Tim Prosch and it’s really great to explain to parents why it’s important to have the conversation early, so it’s not happening in crisis, but instead people are planning for this.

·      And one big suggestion if there are disagreements that occur in families which often is the case; find the help of a financial advisor and aging-like professional or hire a good eldercare attorney.

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Shawn: Now you hear all kinds of deals about leasing cars, how can you negotiate a better deal if you want to lease?

Nina: Okay, well many people don't realize that they can actually negotiate the sticker price on a leased car in the same way that you would do that if you're buying a car. And since when you lease -- when you're, you know, your lease payments basically cover the depreciation, the difference between the sales price and the residual value. So it's definitely in your best interest to try to reduce that sales price as much as possible because then you'll pay you know, smaller dollars over the life of the lease. Make sure you pay attention to the down payment at the lease signing. And so here's an example, you might see an ad that says you know, lease payment is only 1.99 a month and that sounds like a great deal for thirty six months. The catch is, is that it might require a $3,600 down payment. So, if you amortize the down payment, then actually that 1.99 special, becomes 2.99. So, you really have to kind of look at total costs. 

And then lastly, dealerships use the term, money or lease factor, when they're calculating your financing costs and a lease factor is not the same as an interest rate. So, you have to make sure the dealer converts that lease factor into a comparable interest rate so you know what your financing charges are. 

Shawn: At the end of the day, does one method wind up being more expensive more often than the other, or can we tell that?

Nina: You know what, it really depends on how long, if you're going to hold the car for a long time, you're better off buying. But if you know, and if you're not, if you just really enjoy driving and you want to have a new car, then go ahead and lease. I mean, there's pros and cons to both, to be honest with you, it's not one size fits all.

Shawn: Alright Nina, great. Happy Thanksgiving to you. Alright, Nina Mitchell is with The Colony Group, for more go to wtop.com and search Her Wealth.

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Dawn Doebler, MBA, CPA, CFP®, CDFA®, Senior Wealth Advisor

Dawn’s experience spans more that 25 years providing wealth management, financial planning and corporate finance solutions for clients. As an MBA, CPA, Certified Financial Planner (CFP®), and a Certified Divorce Financial Analyst (CDFA®), she is uniquely qualified to understand the challenges and financial needs of clients from executives to entrepreneurs, as well as single breadwinner parents. Dawn is a weekly contributor to WTOP radio.