When caring for a loved one, costs can add up fast. Expenses from healthcare, food and housing accumulate until, before they know it, they’re beneath a mountain of debt. Particularly for seniors, whose health problems can become quite costly, debt can feel unmanageable.
To help a loved one or your aging parents through debt, we’ve outlined several tips below.
Nobody likes thinking about debt. It’s one of those things that’s easy to procrastinate facing. But the longer you wait to deal with it, the more it can build up. That’s why it’s important to get it over with and deal with the debt as soon as possible.
If you don’t normally talk to your loved one about money, make sure you’re in a comfortable environment and approach the subject of debt carefully. Make it clear that you only bring up the subject because you care about their well-being.
That said, at the end of the day you cannot help someone who doesn’t want help. If they aren’t open to assistance with their debt, it could be best to let them be. Just let them know that you’re available if they need help.
The first step toward getting out of debt is to organize your finances. Help your loved one list their current debts, their savings and their checking accounts. Once you have debts listed, you can start prioritizing which ones you want to pay off first.
Once you get started toward repaying debts, you may want to evaluate your loved one’s monthly budget. If they’re overspending on luxuries, then it’s a good idea to cut back so they can put more money toward paying off their creditors.
Once you’ve taken note of what your loved ones owe, it’s time to put together a repayment strategy. One of the best ways to tackle debt is to pay off debts with the highest interest first. This will save you the most money over time.
Another strategy you can utilize is called the Snowball Method, where you pay off the smallest debts first. This helps your loved ones feel a sense of accomplishment and progress early on, which could help motivate them to tackle the rest of their debts.
After you put together a debt repayment plan with your parents, it’s important to hold them accountable. Try to schedule a time once a week or once a month to discuss finances and see how far they’ve progressed towards becoming debt-free.
Debts can weigh heavily on your shoulders when you don’t have a repayment strategy. To help your loved ones gain financial freedom, it’s helpful to walk them through the steps of assessing their finances and prioritizing which debts to pay off.
For more information on debt forgiveness tips for seniors, check out the infographic by Annuity.org below.
Thank you Rhett Rivera for contributing this article.