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Stories from the Stacks – A Soundtrack to an Investment Advisor’s Life Episode 7 – Addressing the Issue of Aging Parents – the most important and emotional relationship shift that you can have in your life. Alex Mihajlov and Trevor Chambers from Olde Raleigh Financial Group, in Raleigh, North Carolina, discuss the difficult topic of the role reversal of children becoming the parents.
- Checklist of five daily activities – breathing, dressing, toileting, transferring, eating.
- Power of Attorney
- Long Term Care
- Do you know parents’ financial advisor? Do you have a relationship with them?
- Never too early to start the conversation.
Hey everybody. This is Trevor Chambers from Olde Raleigh Financial and Alex Mihajlov as well, joining me today. How are you today, Alex?
MIHAJLOV: I’m very good, Trevor. It’s always good to see you on —
MIHAJLOV: — Fridays.
CHAMBERS: Another sunny day. A Friday. We’re very excited.
MIHAJLOV: It’s a beautiful day in Raleigh, North Carolina.
MIHAJLOV: And spending a little time with you on Friday.
CHAMBERS: Yes. Instead of calling clients, we’re doing this.
CHAMBERS: Well, I want to – we want to put out a post today on a very important topic. As the baby boomers move through their cycle of life, we – they’re entering a stage where they’re becoming parents to the parents. Meaning that they’re aging parents are getting to a stage where maybe, they’re having to step in and take over finances. And this is something that is increasingly becoming more apparent in our practice here at Olde Raleigh Financial Group in Northwest Raleigh. And I – so we got together here and we decided we wanted to talk about it. So, Mr. Mihajlov, with all your years of experience –
CHAMBERS: — in this business, could you please talk to us a little bit about some of the challenges that people in this situation are facing and what we might – how do we guide people through this process and what are they seeing?
MIHAJLOV: Well, this is a really important topic and it’s probably one of the most difficult topics in financial planning, there is because it forces children of parents to truly start to become a parent – parents of their parents, which is a very difficult role reversal and quite frankly a lot of people can’t ever do it. But I think it’s one of the most important relationship shifts that you can have in your life and probably almost essential to do at some point.
CHAMBERS: And it’s very emotional.
MIHAJLOV: It’s very emotional and it’s very, you know, we’re not used to telling our parents what to do. We expect them to be all together, et cetera, et cetera. I think the biggest problem people have with their parents is they don’t see them aging.
CHAMBERS: Uh-huh (yes).
MIHAJLOV: They don’t see realistically how they’re aging like maybe other people do. You know, one of the things that we do is if we have a client that’s over 70 or 75 years old, we’re going to get a child to have either Power of Attorney or some sort of contact with us so they know what their parents are doing and so we have a second set of eyes watching the relationship et cetera, etcetera.
CHAMBERS: And a power of attorney, that can be set up obviously through a lawyer and is there anything in particular that you look in there for with that power of attorney?
MIHAJLOV: Well, power of attorney just gives the child, should the parent be unable to make decisions or become unable to make decisions, say stroke or illness or whatever it is, the child can step in and help handle finances.
CHAMBERS: Alright, so there’s – lets kind of go through a little bit of a checklist here. If your faced with this situation, what are some of the things that we like to express to clients and what they kind of need to do. What’s, you know, some of the things they’ll need to do?
MIHAJLOV: I tell children, I say do you know who your parents’ financial advisor is? Do you have a relationship with them? Have you been looking over the – what your parents are doing? And it’s never too early to start the conversation. A lot of times parents, you know, don’t want their children poking around. I’m not at the point where I want my children –
MIHAJLOV: — poking around in my finances.
MIHAJLOV: But, it’s a good thing to have the conversation so children can help. Usually, you have one parent that has handled the vast majority of finances. Maybe the other parent is not as astute in them and a third set of eyes is never a bad thing.
CHAMBERS: Yeah, and it’s a great platform which, you know, as financial advisors we can be that sort of go between, you know. Because we can bring a pretty – just like okay, not emotional point of view to these things so it’s a great – it’s a great thing to – if you can incorporate either their financial advisor or your financial advisor into the conversation, it helps – I think it helps facilitate these things. Some of the other things we look at like does mom and dad have long term care?
MIHAJLOV: Right. That’s a huge, I mean this is a four-podcast topic. But long term care, if something happened to your parents and they could not do one of the five daily activities, which is toilet and transferring, talking, I don’t know what the other two are but they’re strong.
MIHAJLOV: Anyway, you know can they afford to hire someone to help them accomplish those things? What if they start with dementia or Alzheimer’s? What is the plan for that?
CHAMBERS: Yep. And also, just like basic things like where are they banking. Where is the financial records? If there’s log ins, you know, what are they because, you know, it’s just getting things organized and having those kinds of adult conversations about that, so.
MIHAJLOV: And if you have a really elderly parent – I was talking to a client the other day whose father had in excess of $100,000 in his checking account and I was suggesting to him that he separate his father from his money. And he said, “what do you mean?” And I said, “I would minimize the amount of money he had in checking account to something he’s comfortable about to where there’s a two step process for the other money to be moved because it’s much too easy to get scammed out of a check or a checking account number, et cetera, et cetera. Make it a little more difficult for money to be moved or a couple more questions have to be asked before money can be moved.
CHAMBERS: We hear about fraud –
CHAMBERS: My mother’s 83. She gets peppered with calls. I’m sure your parents out there are having the same issue. And they’re vulnerable. You know, especially if they enter into a situation where the Alzheimer’s may be kicking in or dementia or something like that. We’ve heard stories of people just doing, you know, out of character moves with their money under those circumstances, so. Alright, well is there anything else in summary that we need to talk about?
MIHAJLOV: I mean, I think we need to do three or four of these and go through this topic in great depth. But I think if people’s advisors are not addressing this with their families, then they ought to be looking for a different advisor because I think it’s really, really important and I think it’s the most difficult relationship change you will have. You know it comes with all the other changes. Should your parents still be driving? Are they, you know, are they getting good medical care? All these things that becoming a parent again is – and becoming a parent to probably one of the most difficult relationships you can have is a real challenge at a time when baby boomers are already stressed with their own lives and raising their own kids, et cetera, et cetera.
CHAMBERS: And looking at their own retirements. You know what I mean, right?
MIHAJLOV: Exactly. But if anybody needs help or wants ideas, we’re glad to chat with them.
CHAMBERS: Yep. We are – if you are familiar with the Char Grill on Edwards Mill in Northwest Raleigh, we’re right across the street. Grab a burger and come on over.
CHAMBERS: So, well thank you Mr. Mihajlov for this insightful and we will be back. We will break down some of these points that we were talking about in further details in podcasts to come, so. Well, have a great week and thank you for the time and enjoy your holiday weekend.
MIHAJLOV: You too, Trevor.
CHAMBERS: Alright, buddy. Alright, thanks guys. Talk to you soon.
Alex Mihajlov – Full Bio
The arch of his career has now landed his firm, Olde Raleigh Financial, to become a fee-based, Independent Advisory firm. Prior to that Mr. Mihajlov was a branch manager at A.G. Edwards, Wells Fargo and Raymond James. His career has been an evolution and, in turn, his perspective on service has evolved. “My team and I have experienced the large brokerage houses and banks. While they have carved out their spot in the marketplace, I can say it is not for us. We have evolved and we tend to attract those who have evolved away from cookie cutter to a world of customization. They want collaboration. They wanted to be listened too. They want a relationship and we want them to be excited about our relationship.”
Trevor Chambers – Full Bio
Trevor joined Olde Raleigh Financial Services in January of 2015 and his primary role is new business development and marketing. Prior to joining the firm, Trevor spent 12 years working at his family’s restaurant, Raleigh’s Bella Monica Cucina & Vino. “Exceptional service, no matter the industry, is paramount and we attract clients who value and take comfort in being taken care of.”