EP 21: Strings Stronger Than Steel. Aging Parents Abroad
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Your parents sent you to the U.S. to pursue your American dream.
But now they are aging back home, and you are stressed about how to care for them.
This is a common dilemma facing many foreign-born individuals. Being on a work visa makes it even harder.
We discuss the challenges and possible solutions to this issue. We explore
topics such as:
Health insurance
Emotional concerns,
Parents' wealth, estate planning, complex issues related to inheritance, cultural norms, and legal considerations in different countries.
Respecting parents' wishes even if they differ from your own
Financial support considering exchange rates, tax implications, and involving siblings.
Patience, open communication and lots of grace (to yourself) are key.
We draw on our backgrounds as people once on work visas and currently going through the same issues.
By the end of this episode, you'll walk away with 4 to 5 ideas you can implement or start planning on that will help you shore up your financial plan.
The speakers' views and opinions discussed in this episode should not be considered financial, tax, or legal advice. Consult your advisor for any legal, cross-border tax, and financial advice.
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Speaker 1 (00:06):
Welcome to the International Money Cafe Podcast, the show where we filter out the noise on cross-border taxes, finances, and life in the us. I'm your host, Jen Hamm, certified financial planner, founder and owner of Elgon Financial Advisors,
Speaker 2 (00:21):
And I'm your host, man Nadi, enrolled agent, owner and founder of Amman Tax and Business Services. Join us on this journey as we explore the unique challenges faced by inbound outbound families and businesses on taxes, compliance, and financial planning. Let's get to the
Aging Parents and Retirement Plans
Speaker 1 (00:42):
Show. Welcome to another episode of the International Money Cafe podcast. In today's episode, we're going to talk about a topic that's very dear to us because Manasa and I have more or less gone through it and it's a topic that we see a lot of the folks that we work with go through. So this is a topic of aging parents back home, whatever home is. One of the things we found or we see a lot of is for most of us who came to the US as adults, we literally are our parents' retirement plan. I've talked to people who've actually used this same sentence saying, I know I'm a parents' retirement plan and I completely get it. We talk a lot about it, but the bottom line is our parents are right now at home, I don't want to say alone, but they are aging in another country. There are a few that are able to come to the US and they're still having to face some of these issues. So in today's episode, we want to talk about some of the challenges that we are seeing in this space as well as possible solutions. Man, I'm going to pass it to you.
Caring Long-Distance for Aging Parents Abroad
Speaker 2 (02:04):
Yes, Jane. You're right. And when we talk about our parents growing old and dealing with these challenges of not being in the same country as them, then definitely there are a few things that come to our mind, the medical issues and whatever that they may be going through if they are in their seventies or eighties. And there is always the need that we feel that we need to advocate for them and we are not able to long distance. Maybe also on the practical side, maybe looking at a way to help them deal with large medical bills if they need to. Then what are our options of being able to help them out with health insurance? If your parent or if you are from a country where there is a state sponsored or public health insurance and your parents have worked and paid into it, I guess that's not that much of an issue.
Speaker 2 (03:15):
But if you are from another country where there isn't such a state system in place, then a lot of times just planning for giving them this additional support in terms of the insurance and paying for it is great. And so many times this has happened to my friends who are physicians here, we talk about it where they're trying to connect with the physicians that are treating their parents back home and there seems to be sort of a pushback even, or can I even go as far as to say, there seems to be sort of a disconnect in understanding how these treatments are given and maybe even a pushback from the local physicians that they're being sort of talked to by their patients' children. So a lot of this is something that we, especially I guess our generation that we look back on our parents who live back in the country or are here with us, that we need to advocate for them. We need to be practical about maybe supporting them with health insurance and other ways of getting them that support in terms of nurses or other paramedical staff. So I totally agree with you. Challenges for sure.
Emotional Challenges of Aging Parents
Speaker 1 (04:57):
Yeah. And on top of that, there's also the emotional challenge. This is one I see all the time. So if my parents were around the corner, I can drop by any time before I go to work or before I go to whatever I'm going to. But we are torn between two countries and so this is a really big issue. Every time I chat with folks, they're like, oh, I wish I could maybe visit my parents more. I wish I could see them more. But that's not always possible. And so we know we have our immediate families here. If let's say you are married, you got your spouse and your kids and then you have your parents, you have that at the generation. And part of the emotional thing that I see is where I'd love for my parents to be able to spend more time with, let's say my kids.
Speaker 1 (05:52):
That's not possible. And so what I end up saying to people is, let's be okay, as tough as it is, and let's talk to our parents also. But I think start with ourselves to be okay that we are between two countries and we are likely to have two places where we call home. So one of the things we joke with people about is I'll say, I'm going home when I'm going to my whole country. And then when I'm there I say, I'm going home, coming back to the US and this is something I hear reflected over and over and over again. So that emotional bit is really tough. Let's try and be okay with it, but also talk with our parents and sort of explain, but at the same time, if we want them to spend time with the kids, let's do what we can. Obviously this is where we'll probably end up going into the financial aspect of it to see if we can make some of that possible.
Family Dynamics
Speaker 2 (06:51):
Yeah, I know. And when we are talking about that, absolutely. Family dynamics always come into play. Hey, well we are humans no matter which part of the earth you are from family dynamics, sibling relationships, not everything may be hunky dory, right? I mean, come on. But especially like you said, when you have a footprint in more than one country and you are trying to navigate this as well as take care of your parents, then I think that sometimes it's important to have those real conversations with your siblings or your other extended family members back home who may be able to provide that support to your parents if you are not there. And what if you are the only child you don't have siblings, what are you going to do? And then another thing I think that we have to think about is yes, the parents' wealth.
How is Money Dispersed When Your Parents Pass Away?
Speaker 2 (07:54):
If you come from a wealthy family in the country and your parents are wealthy, then how is that going to be dispersed once they are no more? And sometimes culturally these are difficult conversations to have and we recognize that, oh, if we had a penny for every conversation we had with someone about this. But it is important because having a plan is important and making your parents a part of that plan, making sure that these have been discussed, whether it is a will or whether it's what happens is there a probate. And in some countries these kind of get into the nitty gritties of where they live. So there might be several tiers of governmental regulations that are governing things. But going back to what we were earlier about the emotional aspect of this, imagine having to not only deal with the emotional aspect of it, but then also arduous governmental regulations. So I always say, yes, this is a issue that comes from your heart, but you do need to be practical and have your brain lead the conversation sometimes.
Speaker 1 (09:23):
Right? And part of this, I think we were talking about it maybe yesterday or so, is don't throw the parents into the mix. Now you are already, I mean, they'll be part of the mix, I get it, but don't do it in such a way because now you are adding to the stress that they're already going through based on the fact that they're aging overseas and you are practically not there to help with that. So what it's coming down to is it's obviously very expansive, whatever we end up doing. So we want to talk about maybe how we can help with some of the cost issue. But before we talk about that, one of the things I've learned over the years is that I need to respect my parents' wishes. So we may come up with different solutions. You mentioned insurance, you mentioned all the government stuff.
Respect your Parents Wishes
Speaker 1 (10:22):
But at the end of the day, I really, really need to respect packed my parents' wishes for what they want. I may not agree with it. So a good example that I've seen is back in Kenya for example, we tend to send people overseas for different medical treatments. As an example, if your parents are going through some health issue and in your mind you're thinking, I need to send them to that country, I need to bring them to the US for this, and they come back and say, no, we have to be okay with that, that we don't have to make them go through that. And that applies to all other areas of their lives and how they want to be treated. We really need to respect that. We need to ensure we are always putting their interest first despite what seems to be happening around.
Banding with Siblings for Financial Stability for Aging Parents
Speaker 1 (11:17):
So you alluded to the whole idea of siblings, and I think especially when it comes to the cost issue, we need to include all the siblings regardless of where they are. So I've seen cases where I know my siblings who are not here and we have a little account where we contribute some money every now and again, it doesn't have to be much, but over time that kind of adds up. And if it turns out my parents need some financial help, we can jump into the mix and help with some of that. The other thing, and again you talked about the country systems is we probably left home many, many years ago. And so one, we may not have dealt with the systems and the governments at that point with that particular issue, things have changed. So it's really, really important that we start educating ourselves on what's available, what it's like growing old back in your home country, which I think is going to be very different from what we are seeing here.
Have an Understanding of the System
Speaker 1 (12:26):
What are the legal ramifications? What are the medical solutions in place? How can we find people that can advocate for our parents because we are physically not there. And so really you also mentioned for example, the doctors. How can we find doctors who are willing to work with us? So it's almost like having understanding the system but also putting somebody on the ground that can really be our voice as well as our parents' voices. So again, we may not be there physically, but at least we can be involved in all these decisions. Communication is going to be really, really key. We can't just not talk to them for years and suddenly we are jumping into the mix and every family we know is different, the dynamics are different, but being able to keep those lines of communication is going to be really, really important. As well as, and you alluded to these, the cultural aspects involved. I can't just assume I'm going to be my parents' power of attorney for example, or medical power of authority. I need to understand the cultural ramifications of what that is and how it's done and kind of go into the system with that mindset. Does that make sense?
Speaker 2 (13:46):
Yeah, totally. And then when we are talking about all of this, I think it's also important to understand how you are going to manage this. What is your cash flow? It get down to the practical nitty gries of it, right? Do you need to add a line item and start saving for any eventuality? What is the cost of doing this? How are you going to transfer money to your country or what are the different ramifications of having money in the country? So we talk about this a lot on all up episodes about having foreign assets and having foreign bank accounts and we won't really go into that today. But that goes to say that there will be reporting requirements and consequences on both sides of the border, whether in the country where your parent lives and definitely here in the us. So you start saving, find ways to cost effectively, maybe send money to your parents.
Speaker 2 (15:02):
There are many different ways of doing it. We have, not that this is not a sponsorship, but then we do know that a lot of our clients use different accounts like Zoom and wise and things like that. Just start saving, be cognizant of being on accounts in foreign country. Even if you are on a joint account with your parent, know that having signatory authority on these accounts would mean that you have to now declare them on your US taxes if you cross the thresholds. And also when we are talking about line items and things like that, know that exchange rates matter a little could go a long way if you're sending money to a country where the exchange rate is favorable to you as the US dollar holder or not. So that's something that I would definitely plan for keeping in mind all that we just spoke about. So I think that's getting into the practical aspects of financial and the tax planning. Right Jane?
Spending Time with Aging Parents Abroad
Speaker 1 (16:10):
Yeah, and we've already addressed some of how you end up sending money. The one thing I want to add to that is I know, and again this is obviously a very personal thing, the relationship you have with your parents, more often than not, I think time is probably what they would really like to have with you, any way you can do it. So part of that line item could be flying home every now and again.
Speaker 1 (16:41):
It may not be practical. I completely get with our jobs and if you are on a work visa, but thinking long term, it's probably one where if you are self-employed, and again it all depends on your immigration status, it may give you that freedom to be able to go spend time with them again. Really, it really comes down to how much time I think you're able to spend with them. And I think they probably appreciate that more. So I'm trying to think, I think we've addressed just about everything. We've able to spend time with them, do it. We've talked about, we did talk about the estate planning part of it actually. You want to make sure you figure out what the legal system is, make sure you find lawyers that again will respect your parents' wishes and their culture and are willing to work with you.
Speaker 1 (17:37):
As you've pointed out. There's also the whole inheritance and money comes into being and we probably don't want to talk too much about that for now. We'll probably have a different episode to talk about that. But yeah, understand the legal ramifications of every action you take as well as if they start putting, you start getting them to put the essay planning together, every line item of whatever they put in there. What are the implications of that? So really work with the professionals in that country. Is there anything else you can think of Manasa to add to this?
Speaker 2 (18:16):
Well, there's been a great episode. I can't think of anything more to add. I'm sure we'll come up with more ideas that will be spinoffs from this episode that we can get into in greater detail with a longer episode on a different time. But you and I, and I'm sure our listeners will also agree these wealth issues and health issues with aging parents abroad is a minefield and we got to plan for it and take into consideration that we are here in the US and things may not be the same in the country where your parents are. So wrapping up our episode today, dear IMC, listener, if you have a feedback on our episodes or you have comments that you would like to share with us of any of these conversations that Jane and I have resonate with you, we would love to hear back from you. We are on LinkedIn. We have a page, the International Money Cafe, if you are on LinkedIn as well, please come and drop us a comment there and we would love to start a conversation or you could reach out to us on any other social media handle or go to our website, the i am cafe.com and send us an email and we would love to hear back from you signing off for today. Thanks for listening. Bye.
Speaker 3 (19:50):
Thank you for listening to the International Money Cafe podcast. The content is for informational and educational purposes only, and should not be used as a substitute for professional advice. Seek the advice of your qualified service provider with any questions you may have regarding your cross order finances and tax needs.