Canadians are ill-prepared financially to support aging parents and could use the help of a financial advisor to sort things out, according to a survey commission by FP Canada and Chartwell Retirement Residences.
As Canadians age, many adult children believe that providing financial support to an aging parent will hurt them financially. Yet at the same time, fewer than one-in-three Canadians say they're familiar with the tax credits, grants and other financial tools available to help alleviate the financial impact of this support.
Of more than 1,500 Canadians surveyed, 14 per cent said they expect that supporting their parents financially will cause them to postpone their own retirement. Another 12 per cent said they expect it will prevent them from paying off debt. Canadians between the ages of 18-34 are particularly worried, with one-in-five (18 per cent) expecting to postpone their retirement as a result of financially supporting their parents.
Parents and adult children don’t talk about money
One of the biggest problems is that elderly parents and their adult children don’t talk about finances, said Sharon Henderson, vice president of Marketing and Communications with Chartwell Retirement Residences. This can create uncertainty and prevent planning for financial support.
Henderson suggests parents and adult children use a financial advisor to help them sort out the issues.
"We believe aging adults could benefit from supportive solutions like the lifestyle in a retirement community a lot earlier in their retirement years if they fully understood the costs, as well as their own finances and resources. This starts with a financial conversation with their children and a financial planner, such as a CFP® professional.
“Planning for future support now will help empower older adults to achieve the lifestyle they want in retirement, and also bring their families peace of mind when it comes to understanding the costs."
The survey reveals that fewer than one-in-three Canadians (28 per cent) are familiar with tax credits associated with dependent parents. Only one-in-five (22 per cent) said they are familiar with grants, loans, rebates and other financial assistance programs associated with renovating their home to accommodate their aging parents.