Category: Finance

The Challenge of an Aging Population

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Much of the world is aging. This demographic trend presents a challenge not only to policymakers but also to most of us as we deal with our aging, that of our immediate families, and those of our extended circles.

65th Birthday Party. Source: aesta1

Over the next 20 years, Canada’s senior population will grow by 68%. The 75 plus will double. The same is true in other countries.

Indeed, this is becoming a significant concern as many aging adults are also getting sick and demand care beyond what they can do for themselves. This care often falls on immediate family members who also provide and care for their families. No one is exempt from the impact of this growing trend.

I see our growing concern when I socialize with my friends in our seventies. Some are still active and able to care for their grandchildren, although they admit it is becoming more of a challenge. Others already need care as they have difficulty walking alone or remembering things. 

Many of us live on our own and will have to depend on our extended families for care. Some are lucky to have caring nieces or nephews, but most complain that weeks can pass without their extended family members asking how they are. This gripe is often understandable as extended family members work stressful jobs and care for their children and, sometimes, grandchildren. 

Our regular togetherness makes us escape isolation. It gives us companionship, so we try to do it often. Still, the issue of an aging population continues to niggle at us. Some of us feel the what-ifs. What if something happens to them and their mobility is affected? Will they continue to live on their own or be with family members? What if they pass out and no one is around? Will they be dead by the time people find them? What will happen to their dogs and cats who depend on them? These are real concerns for those who are aging. 

Of course, this also impacts the immediate family members. What are they going to do? Will they put their loved ones in a home? Homes for older people are getting scarce and expensive, and many need help to afford to be in them. The affordable ones are not so good that you hesitate to put your family in them. 

If they put them in a home, who will pay if the aged person doesn’t have enough resources? Will they be able to find one? Will it be convenient for people to visit, especially family members who no longer drive?

What about the attitudes of these Seniors? Many who have cared for themselves all these years are demanding as they expect similar assistance. They are not easy to live with and are critical. 

Early on, we need to face these issues. The critical responsibility belongs to the aging person to prepare for this phase in our lives. We cannot leave the burden solely on family members. This preparation consists of:

  • Eat healthy. If we still need to do this, we need to start now. You can even plant vegetables or pots to inspire you to eat what you harvest. Choose to grow vegetables you enjoy eating.
  • Exercise. A family friend who used to vend foot blankets in the town and even adjacent ones reached over a hundred and could still walk alone. My niece, who is overweight, recently took action. She wakes up early, goes to the town plaza, and walks around until she completes ten thousand steps. It is never too late. Start whenever you can.
  • Take care of your finances while you are still able. Learn to save and invest your money so you have enough resources to retire. Many problems are solvable when you have the resources to do so. Don’t be stingy, especially to your possible future caregivers. A friend told me that each time she asks her nephews or nieces to help them with things they could no longer do for themselves, she rewards them. So, each time she calls, they immediately come. This is your investment, too. Another friend who does not do this, her family members, stays out of her calls. Generosity goes far. Take care of them, and they will take care of you.
  • Choose to live close to family members. It is difficult for them to help you when they must take a plane or drive five hours to be with you. Be realistic. It is no longer what you want but what is convenient for people to be with you unless you have all the resources to be on your own and pay for all the care you need. 
  • Choose accommodation that’s easy to live in for an older adult. You may want to stay in your house, but your capacity may need help to take care of it. Ensure you are close to grocery stores, hospitals, your doctor, dentist, and whatever you need most. My friend had her house renovated for easy access when on wheelchairs and when needing care. A room for a caregiver will be helpful.
  • Know more about available care in your community. This care includes those provided by the government and private providers and may cover home visits, transport assistance, and actual care.
  • Please familiarize yourself with Senior homes and what they provide. Know the costs of each service. Read reviews to make the right decision when you need to move there. 
  • Prepare your mind for aging, especially for needing care. At specific points in our lives, we will need maintenance.
  • Make your will and power of attorney for your health with all the instructions you want done.
  • Choose your funeral and pay for it so it will not be a hassle for those left behind. 

Meanwhile, enjoy your life and lobby for better care for Seniors. It is good to get yourself ready so that it may still be painful when the moment comes, but the transition will be smoother.

7 Ways of Involving Family in Investment

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Retired or not yet, this is one thing you and I need to think about. It becomes even more concerning when we advance in years. Often, people pass on and nobody in the family knows anything about their assets. Think now and start doing something. It is time.

Why Invest?

I still remember being a Grade 4 student and helping my sickly father think through investment strategies.

My job and wow, was I ever proud, was to do the math as he sorted out the cost implications of assorted investment options. I am not tall even as an adult, but I was at least 2 meters tall there as my sisters sat by while Papa and I were working.  

Maybe that’s why this particular incident has stayed so clearly etched in my mind. I never imagined then that I would end up earning money through investment myself and that it could be fun rather than struggling with bad health and searching for family rescue. 

But a few years ago when I discovered the Market, I pulled back quickly what my father had asked me to find solutions for, what costs to check out, how he compared the various investments such as real estate, investing in small companies, expanding our business, loaning money out and other choices. 

Years later, a close friend of mine whose family really amassed wealth shared with me how on weekends, her father would put the whole family in the car and just keep driving through the small towns and villages. 

When he saw land that he liked, he tracked down the owner and gave him an offer. The family had a great time with picnics and swimming around the Province and their parents had a ball looking for real estate they wanted to invest in. 

Although they pursued various careers, their mother always insisted they take real estate investing courses. And even though I was not a member of their family, my friend’s sharing opened my eyes wide enough that when my husband and I had some extra money, off we went scouring the villages well outside of the cities that could become cottage sites for wealthy boomers when they cashed in. 

Although we had day trips in some far-out areas, we were led back closer to home. You’ll never know what you’ll find when you search. This is the fun of the search and until now, we still have this riverfront property which we share with the bears who forage the wild berries and the beaver who savage the small trees but build great dams. 

We bring the grandchildren here (they scare off the bears) and we hope they get a sense of how actively we pursue investing. They ask questions and they start getting into conversations about land and cost, appreciation and markets. 

Last year, one University grandson brought a friend to stay with us and they, in desperation to start a conversation that didn’t include questions from us on beer consumption or ahhhhhh University life, started asking questions about things we had done to support the life we are currently revelling in. 

We tried our best to tell the story with its peaks and valleys and tiny bits of real knowledge. A month later, while sitting outside watching Seadoos, sailboats and floating docks trying to share the same space simultaneously, the grandson, as an opener so his search for beer would be less blatant, came to inform me that the same friend had just bought BP shares. YES BP, the one company with more disasters and thus, more to prove than a 20-year-old male. 

I was happy that somehow he had learned to start investing early and to think about potential and risk and the impact of ego on the market. They will have successes and failures, gains and profits, but they have learned early to create wealth. 

Our grandson now has a job and has invested in Boeing. It is his choice and we encourage it. The earlier they learn how to choose stocks on their own, the better it is. They have more than enough information online to make a go of it. And if they fail, it is a lesson well learned.

Don’t Force It

We only talk about investing when they ask, although they hear us chatting with each other. And they see us hunker in our computer bunker to track our stocks’ performance or see us scour the papers on our Kindles for news we can use. Tsunami in Japan? Hmmmmm. What does that mean for insurance stock? Will they rebuild with wood and if so, from where? Will the Atomic Reactor problems affect future plans for more reactors and so the demand for uranium? A great detective game and really engaging. 

Sometimes, kids browse through books you leave around in your living area. When you stick it to them, chances are they’ll set these aside but just have a few lying around. A page or two once in a while will make them think a bit.

Ways of Involving your Family in Investment Decisions

Depending on you and your family relationships, there are many ways of involving your family in investment decisions:

1. Do your investing as a family team. They look and watch and even if they seem disinterested, believe me, they are if you can make it fun. 

2. Bring them to your bank or your real estate transactions. They will learn some points even if they don’t talk about it and they’ll learn about good manners in discussions and respect and even a bit about negotiating.

3. Ask them relevant questions. Engage them on discussion on what their friends are buying and what young people go for these days and invest in one of these companies and track this with them.

Gain or loss, the important thing is the lesson, but choose well as gains are always great incentives. Toys for the youngest (Mattel, Disney, Hasbro) and maybe fashion or electronics as they grow up a bit. 

Ask them to help you do some investment tasks like research and find out how a new product is doing in the market. They have a keener insight into choices made by their peers than you have (New soft drinks, franchise restaurants with new lines, Playbooks and Android). Recognize their help. This will boost their confidence or make them learn a lesson they can use when they invest their own money. 

4. When they show readiness, give them the knowledge necessary as well as the opportunities to build their skills. There are many transactions kids have to learn to manage their own money but often parents are so protective that they deprive them of learning what will help them eventually live their own lives.

Money is an instrument. When they need money, they will learn how to go about certain financial transactions. We have to trust their judgment without crushing them. Maybe a debit card to start. We need to give them space as they learn how to think through money. 

5. Show them how to manage money. To do this, some of our grandchildren are given their monthly allowance by their parents, placed in their bank account and they have their debit card to use whenever they need the money. They don’t have to come and ask, but they can’t spend more than is in the account. They know they have this amount for the month. With phones top-up cards only. Their spending habits immediately become more considered and a bit of quick math with a squinted left eye goes on before each purchase, and phone calls get seriously short.

When it first started, the eldest blew his allowance immediately on an expensive t-shirt with mysterious iconography understood only by sophomores. A rough penurious month followed, but the lesson was learned (sort of) and careful management (sort of) is now the norm. At least, no monthly bankruptcies.

The second grandson (we call him Silas) keeps his money and holds on to it right to the end of the month to meet targets such as upgrading his drums or buying some Alice Cooper endorsed nail polish. 

6. Gift them stocks on special occasions. They can choose what stocks to buy. You can discuss with them what guidelines to follow or ask them to use what they’ve learned if you followed earlier points and taught them a bit.

They can research on their own online as there is a truckload of information on every investment instrument out there. Once they own the stock, you can track its performance with them and explain market fluctuations and how to manage that. Greed and Fear! 

7. Encourage discipline. They will learn in the process. The eldest always ask not to give him too much money. He knows himself. So, your intervention would be to give enough, but maybe match savings at the end of the month. It is good to know their spending habits early so you can nudge a bit or intervene and manage the process. Maybe residence the first year at College so at least they get food if all else fails!

You need to be disciplined yourself so you don’t give in to the same feckless requests you used 40 or 50 years ago. 

There are many ways you can involve the family in your investment decisions. Celebrate when you gain so there is a strong incentive for them to be part of the process. Laugh and show what happened when you blow it. It will make you seem more human! 

But above all, know that each child or grandchild is unique and thus, will have different interests. Encourage those who are interested but don’t force those who are not. They follow a different drummer. Not everyone has to be a savvy investor.