Ageing parents? How to avoid money blow-ups with your siblings

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As parents age, those old feelings of sibling rivalry can often make a surprising re-appearance. 

Almost everyone over a certain age has heard war stories from friends engaged in bitter battles with their siblings over the care and financial assets of parents whose health or mental capacity is deteriorating.

“You can be a happy family and then with the sudden arrival of aged care issues, it can lead to an implosion,” says Brian Herd, a Partner with Queensland law firm CRH Law, which specialises in elder law and estate administration.

“It can expose the enmity and jealousies between family members. Often all the children will not be on the same page about what to do, so it just destroys the family.”

With US researchshowing nearly 70% of adult sibling quarrels focus on inheritances, parental care responsibilities and financial support, it’s not an unusual situation either.

So how can you avoid things getting nasty?

Start the conversation

The secret to keeping a lid on things is to try heading off problems before they arise.

“This avoids the crisis management syndrome, which is very common. It’s usually only then that people start discussing these issues, but that’s when things can be very emotional,” explains Herd.

A better idea is to discuss how your parents will be cared for, well before the need arises.

“Aged care complexity knows no bounds and it’s an issue that breeds an avoidance mentality, but it’s important to discuss it and develop a family plan of action,” says Herd.

While it can be an uncomfortable conversation, the topic is unlikely to arise on its own.

“Parents are reluctant to talk about it, so children will need to raise the issue,” he says.

Work together, not individually

It’s vital to involve everyone in the conversation – and the subsequent family plan – otherwise it can create suspicion and resentment.

“Do it collaboratively, rather than individually, so it’s not seen as being done out of self-interest. If the family are all involved, it can help keep everyone together,” suggests Herd.

Talking about things gives your siblings time to consider potential care options and the financial implications of ageing parents.

“Without preliminary discussions before a crisis, children can find themselves unexpectedly having to contribute financially. This leads to problems if they haven’t anticipated having to do it and they may be forced to rearrange their assets to pay for mum or dad’s care,” explains Herd.

“If some siblings are forced to stick their hand in their pocket – or have to pay more than others – it can lead to an even bigger cleavage within the family.”

Develop a family plan

One of the key ways to avoid a blow-up is to develop a plan outlining the family’s discussion and decisions around parental aged care.

“With a plan, everyone knows what’s going to happen and agrees how it will work. The decisions should be in writing and shared with the entire family,” says Herd.

Learning about the aged care system is another vital step.

“Knowledge is important in understanding the options, creating a plan and working out how it will operate,” he notes.

After the family conference, encourage your parents to seek in-depth professional advice from a financial adviser or lawyer on the available options and their financial implications.

This is essential if care is going to be provided in a family setting.

“You need legal documents covering the situation if mum or dad is moving in with one of the children, which many families see as the preferred option,” says Herd.

This approach has financial incentives as it can help preserve parental assets, “But it needs to be fully documented to avoid problems later on.”

7 tips for avoiding sibling arguments

1. Start talking early – don’t wait for a crisis, raise the topic of aged care with your parents and siblings well before there’s a problem.

2. Involve everyone – talk to your siblings first, then raise the issue with your parents as a united front.

3. Get informed – learn about the aged care system, potential costs and the available care options.

4. Develop a family plan – document the family’s decisions about parental aged care and finances.

5. Don’t let past conflicts interfere – try to discuss the issues openly, avoiding re-opening old wounds.

6. Keep it about your parents – put your parents’ wellbeing at the centre of the conversation and work towards the common goal of helping them.

7. Ask for help – if communication is difficult, seek assistance from another family member or an outside expert like a financial adviser or lawyer to guide the conversation.

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Important: This article has been prepared without taking account of the objectives, financial or taxation situation or needs of any particular individual. Before acting on the information, you should consider its appropriateness to your circumstances and if necessary, seek appropriate professional advice. Any information used in this article is for illustrative purposes only. CRH Law is an external entity that is not a member of the Commonwealth Bank of Australia Group of Companies (the Group) and the content or any view expressed by CRH Law and its employees does not represent an endorsement, recommendation, guarantee or advice in regard to any matter. CBA, nor members of the Group accept any liability for losses or damage arising from any reliance on external parties.