By coinnews 
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Are you a caregiver? What are some of the financial and emotional aspects of being a caregiver? Well, here to talk with me about that and many other things is Chris Herman. He is the head of retirement at Bank of America. Chris, welcome.Thank you Bob, it’s a pleasure to be with you. It’s a pleasure to have you here. It’ll be a pleasure to have you discussed this notion of what are some of the emotional and financial aspects of being a caregiver and, and also what are some of the emotional and financial aspects of what happens after the person that you’ve cared for, uh, passes on, um, where to begin?
0:42 spk_1
Yeah, it’s a great question. Um, you know, I’ll go back my, um,You know, my, my joining the the retirement industry really coincided with my um working with my mother, uh, coming out of uh a divorce and trying to help her establish herself, uh, financially independently. And it was through that experience that I developed my passion for what it is we do in this industry, as well as I learned a lot.Uh, of what people have been going through for, for many, many decades. And, and that is, in particular, um, helping care for and, and, and take care of an elderly parent. Uh, when my parents were divorced, my mom was, uh, not in a good position, uh, financially. Uh, she was very concerned about her ability to continue her lifestyle, let alone retire, uh, at some point in the future. And, uh, I took it as my role for her to be called, call it a financial.caregiver. And it came less in the form of outright payments or or uh uh supplements I provide to her, but more helping her help herself and understanding her financial situation and, and what she needed to do. Um, and, and so with that process, we began a journey over the span of 25 years of me checking in on how she was doing, her sharing with me, where she felt good, where she felt anxiety.And where I’m sure a lot of caregivers that are out there, uh, in their roles, uh, have to play this role of of of a listener, uh, and, and to be there just as a, as a form of uh emotional support.And caregiving as much as physical or financial caregiving.
2:28 spk_0
Yeah, let me go back to the topic of divorce. A lot of times I know that women when they get divorced are sort of lost at sea. They’re wondering about income. They’re wondering about how assets will be divided, whether the divorce was fair or not.And uh and then what the future holds in store for them. Maybe talk in more detail about sort of uh what you went through the tactics that you used to sort of help your mom address the concerns around assets, income and uh and her future.
2:56 spk_1
Yeah, it, it really bobs. It started with the taking of inventory. I’ll admit I, I didn’t know my, my parents’ situation fully. I didn’t know her situation coming out of the divorce fully. And so I asked her to sit down and I said, Mom, let’s pull out the statements. Pull out your retirement plan statements, pull out your checking account. She told me she had some CDs and another account. I said, Mom, let’s just take stock. Take stock of everything you have.And maybe just in finding that the the place where you are, you’ll find some comfort to before we even start talking about where we’re gonna go from here. So I that was 0.1 it’s just taking stock, taking inventory of everything that she had, uh, and then putting together a very simple budget. Um, there are some nice tools that are out there available online, but I just use a spreadsheet and I laid out, OK, this is where the income is coming from, as you have in the way you’ve expense it.And um this is how we’re um gonna pull it all together. And so just it was pretty basics um that wedid that.
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So Chris, I, I think for me, we’d like to provide people with actionable advice. I mean, if for those who might be on divorce’s doorstep, uh, is that the primary bit of advice is that you need to sort of take stock of your assets, your liabilities, your expenses, your sources of income? Is that sort of step one?
4:19 spk_1
I, I would say yes, and then find somebody that you trust that can work with you on this. Um, I, I had another friend, not the divorce, but just a premature death, who who found herself in in a situation that my mom found herself in, which was on her own and trying to take a stock of everything um that she had to deal with. And, and for her, my role was to be a sounding board, uh and to be there while sheUh, met with other financial advisors as she considered what to do. So, yes, absolutely. You want, you wanna just take stock, take inventory, don’t rush into any decisions. Typically, there’s no need to rush in any decisions, and it could be coming right out of the event, a very emotional at time, and so don’t make decisions if, if you don’t have to, and then find a person or persons that you can trust and just that you can speak with openly about everything related to your finances, whether that be.Uh, things you’re concerned about, whether they’re your aspirations. I think having those sounding boards is very, very important and not trying to go through it all alone.
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Yeah. And my sense is that for some this can be an overwhelming task because the language of divorce can be so off-putting that there are things like quadros that you have to learn about, right? qualified domestic relations orders, and uh that’s something that you didn’t need to know prior to the divorce and probably after the divorce, you would just assume rather not.it as at all as well, right?
5:46 spk_1
No, there, there are, there are, there are acronyms in our industry. There are a lot of technicalities with it. All the more reason by having somebody you trust who can work withyou through that.
5:55 spk_0
Yeah. So fast forward, this, this happened when your mom was reasonably healthy. Over time, uh, you and your sister, you had mentioned to me, uh, became caregivers. Uh, maybe talk a little bit about that journey. I know we’ve had people on the show before inmately, um, and, um.Ah, uh, Annaly Krueger, who, um.At one point said, you know, the need to create an elder plan long before there’s a crisis is essential. I’m curious. Did you put in place such an elder plan for your mother as she was, uh, uh, uh, aging on?
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I, I would say we, we, we had an idea, we had a concept of a plan, uh, which really involved wanting to support our, our mother the the best we could. So, uh, we were, we were happy that we could get her established in a home of her own that worked for her, that was within her budget, and she was very happy, um, in that situation, and she was determined in her own words, like many parents will say, I never want to be a burden on you, my children, I never want to be a burden on you.But my sisters and I talked and agreed. My mom got to the point she couldn’t live on her own.Of course, she would move in with one of us. Um, and my oldest sister was the one, closest to her, uh, physically, and, and ultimately, when my mom was not able to live by herself anymore, uh, she moved in with my oldest sister. It was my mom’s choice. That’s where she wanted to be. And, uh, at least initially it was, it was wonderful for both of them. They were very, very tight. Um, my sister was more than happy to help my mom with anything she needed.Uh, my mom had a level of care in the house that she didn’t have before, and she had been experiencing falls when she was living by herself and, and a couple of very scary situations where she couldn’t get to a phone to call for help. And, and that those risks went away when she moved in with my sister. Uh, what was not in our plan though was eventually my sister’s ability to care for my mother deteriorated as well, um, as she got older.And reached a point ultimately where for my mom’s safety, for my sister’s safety, um, we needed to put her in, into uh an assisted living, uh, facility. Uh, we had not planned on that. We were pretty much adamantly against that. We didn’t want that to happen.Uh, but it became a matter of safety, and that was where we would have done a better job planning for, or at least um considering that as a potential outcome and a risk and budgeting and, and, and planning for it, but in all fairness, we, we didn’t consider that at thetime.
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Um, it’s interesting because that’s a common path, right, that the primary caregiver is unpaid, largely it’s the daughter who’s doing the caregiving. It takes its toll on that person.And uh over time, like you said, the person doesn’t want to become a burden, but in order to avoid becoming a burden that the long-term plan has to perhaps contemplate the possibility of needing assisted living, nursing home, continuing care, retirement community, or in-home care from a professional of sorts, right? Is that fair to say?
9:02 spk_1
Yeah, it is fair to say, and and we were fortunate between my sisters and I and and my mom’s own savings thatShe was able to afford this for some period of time, but many others aren’t in that situation and, and there are financial solutions that are out there like long-term care insurance that can help uh in terms of planning for the, the financial burden of that risk. But as you said, Bobby, there are burdens well beyond financial that are associated with caregiving.That just, you know, uh buying insurance doesn’t necessarilycover. Yeah,
9:33 spk_0
so in retrospect, Chris, I’m curious, what advice would you have for folks who haven’t yet gone through what you have gone through, uh, and knowing now what you know, what you might have done differently.
9:43 spk_1
Yeah, I’d, I’d say first, you know, having that conversation with the person you expect is potentially gonna need long-term care. It, it’s a difficult conversation to have. And, and oftentimes the, the, the, the elder person will not want to engage in that. They’ll, they’ll be adamant in terms of, I’m not gonna be a burden on you, and I’m never gonna live in assisted living. But just know in the back of your mind that one of those two, is, is likely to come to pass if they, if they live old enough.So having that conversation and then the the the honest discussion of what would they prefer, what would you be able and and willing to do in in your role as a as a as a caregiver, and it’s OK to say I I’m not, I would not be in the position to care for you myself personally.Then what can you do? There are other options available to you. Having that conversation and then laying out some options and some plans on how you could see that that person you love is gonna get the care they’re eventually gonna need. Don’t, don’t wait until you’re in the moment to have those conversations.
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Yeah. Um, I, I know we’re, uh, we’re gonna take a break in a second, but I wonder if you could speak quickly about after your mom passed, there are some financial things that people need to consider.Uh, things like probate court or beneficiary designations or trust if there are any trusts in place. Uh, quickly, any thoughts about what people need to know about those three things, uh, after someone passes on?
11:07 spk_1
Sure, you know, I’ll, I’ll say most importantly, your retirement accounts, uh, don’t pass through probate so long as you got your beneficiary designations done. And too often.Uh, they lapse, um, or they’re left empty altogether, and it creates a a tremendous burden then on the people that are ultimately gonna inherit that, uh, to sort that thing out and the legal costs associated with it. So, uh, encouraging, uh, your, your, your family members to know that they need to have the beneficiaries up to date and then of course, doing that for yourself in the worst case situation, somebody.Uh, dies prematurely, have your beneficiary designations nailed down and that avoids probate and at least for that part of the estate, it’ll be a simplerprocess.
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All right, Chris, we’re going to take a short break and when we come back, we’re going to go to the other end of the spectrum. We’re going to talk about what we can do to help young adults get off on the right financial foot. Don’t go away.Welcome back to Decoding Retirement. Hi, I’m Bob Powell, and we’re talking to Chris Herman. He is the head of retirement at Bank of America. Chris, before the break, I promised that we were going to go to the other end of the spectrum and talk about what we can do to help young adults get off on the right financial foot. Uh, you’ve had some personal experience around this. Tell us more.
12:23 spk_1
Yeah, sure. So I, I have uh 33 children, uh, 26, 24, and uh 20 years old now.And um two out on their own, the third, uh, halfway through, through college, um, I, given my, my profession, I, I thought it was very important to instill what I could, uh, about saving and investing, uh, with them, share with them my, my perspectives, uh, on that, uh, and I’ll just talk about my, my daughter Jenna. Jenna is, uh, in the industry, as they say, and has been very open and receptive to my viewpoints in terms ofUh, things to consider, uh, things you want to do while you’re still young, um, uh, pitfalls to avoid, uh, and, you know, unfortunately, our education systems are, are not typically teaching financial basics and investing basics, and, and so a lot of people graduate from college with a cursory understanding of, of, of this. Fortunately for Jenna, she had this as part of her her education. She has some background in it, but I did share with her.Just just a couple things and I’ll talk about the basics around investing. Uh, I put together a little PowerPoint presentation for her, which she had the patience to sit through while I flipped through. But page one, I shared with her, I, I said, uh, that there is always, always a tradeoff between risk and return and run away from any salesperson who tries to convince you otherwise.And I said it’s, it’s perfectly fine to swing swing for the fences just know you might miss entirely and end up back in the dugout with nothing. So anybody who promises you a home run in every swing, don’t, don’t believe it. Uh, and at the same time, if you keep yourself very safe and secure, just know that you’re gonna be missing out on opportunities forInvest in growth and and wealth creation. Just know that there’s a trade-off and um the other thing I shared with her as I said, so long as fear and greed are human emotions, there will be market booms and busts. Uh, and, and so come to accept that that’s part of the reality of investing, but don’t get yourself tied up in the emotions of that. Stay the course in your plan.And now, it’s just part of the, the market and part of human nature that we go through these cycles from timeto time. Yeah,
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I think you’re lucky if I sort of sat my daughter down with a PowerPoint presentation, she might have rolled her eyes and then asked how many PowerPoint uh slides are there and if they’re more than one, I’m not going to tolerate uh you lecturing me. II’m curious. I mean, she’s in the industry. When you think about young people, they enter the workforce and much of, uh, and you’re right, they don’t necessarily get it in high school or even in college, but when they get to the workplace, they might get exposed to, uh, financial education there from their, uh, from their plan sponsors and planned providers. Uh, any thoughts about like, is that the best place for people to start becoming engaged in becoming a more savvy, uh, saver, investor, planner?
15:24 spk_1
Right, absolutely. And, and at Bank of America, we, we administer um thousands of retirement plans and, and the education of the employees in those plans is very important. And the good thing for the employees who have access.To these retirement plans is there are a number of resources available online, in-person seminars that are all geared towards helping you become a better saver. And so it’s typically through the workplace that individuals get their first exposure to saving, to investing.And the resources are really, there’s been a lot in the industry invested over time to make these impactful and to make them work for people. So yes, it’s typically through the workplace. The couple things that I’ll say, uh, in that regard. One is, if you, if your employer is offering you a retirement plan, take advantage of it. There are still a large number of people who don’t participate in their employer’s retirement plan.And most employers now will put money in to their employee’s account on their behalf so long as they’re participating. So a failure to participate is leaving money on the table. And the second thing I’ll say is stay invested.Uh, these market swings can lead people from time to time to want to pull money back and then invariably it’s at the wrong time and then they never get back into the market, stay invested through these periods. That’s a message, Bob. I’ll say that it’s, it’s resonating more and more. We’re seeing less and less people taking action in in the face of a market tumult, uh, and selling out because the market went down a lot. People are staying the course and it is going to be for their benefit long term.
17:06 spk_0
Yeah.So I’m, I’m curious too. I want to talk about volatility and staying invested, but I also want to have you address this notion of young adults. I have children who are 30 and 26, and my 26 year old daughter, uh, people who have listened to this show in the past have heard me say that, uh, for all the talk that we did in our household about money and saving and investing, etc.Uh, it wasn’t until she listened to Mrs. Dow Jones on TikTok or Instagram or one of those social media platforms that it sort of, uh, took flight that she made the connection between, uh, what she was saving for and what she was saving in. And I, I’m curious, do you have any thoughts about whether young people should turn to social media and, and if so, how can they sort of distinguish the good advice from the bad advice?
17:49 spk_1
So I bet that’s a great, that’s a great question, Bob. I’d say whether we want it to happen or not, more people are gonna go to social media, uh, to get some level of financial education, and there are really good resources out there.There are some less reputable, uh, ones as well. Um, so I would say it’s like with all things caveat Mor, uh, I think we have to acknowledge the fact that social media and influencers will be speaking more and more to young people. I think as a parent, um, it’s a great opportunity for you to ask your children, where are you getting your financial information from? Tell me more about that. Invariably, when I ask my kids, they’re gonna give me the name of something I’ve never heard of before.And OK, that’s an opportunity for me to do a little research and then I can, I could pass muster on it and say, you know, that’s actually, yeah, that’s really good advice, and I’d never heard of this person and it’s great. Or if it seems a little, maybe not in their best interest to share that perspective as well. But I, I think we have to be realistic. The young folks love the, the input of influencers, they’re gonna go to them.I think we as as parents, we have to acknowledge it and try to be as aware as possible around where they’re getting their information from.
19:04 spk_0
So many young people don’t necessarily have the assets to work with an advisor. What options do they have?
19:12 spk_1
So typically within retirement, if you, if again, if your employer has a retirement plan, most plans now, in addition to offering education, they offer some form of advice, uh, and it can be in the, in the form of an online tool where you can put in your goals and your savings plans, and it will recommend to you.Uh, in an appropriate investment allocation, it will keep it balanced and will rebalance it through that allocation. It’ll recommend additional savings, um, and that’s available within retirement plans. Uh, outside of retirement plans, there are a number of, uh, calculators and tools that are available. At Merrill Lynch, we have one called the Personal retirement calculator where you can go in and start to build your own financial plan for free.It’s not behind the login, and there are plenty of other examples that are out there, but I’d say go to a financial institution that you know.And you trust when you go to these online tools, uh, or your employer’s retirement plan. Uh, I think there are some great tools out there for free that people can use to get better educated.
20:14 spk_0
Yeah, you know, it’s interesting, uh, we’re talking the day before the Employee Benefit Research Institute will release, I think their 26th or 27th retirement confidence survey.And routinely in that survey, one of the things that they note is if you’ve done a calculation to determine how much money you need for retirement, you are that much more confident about the security that you’ll have in retirement versus those who didn’t do the calculations. So I think if I could leave anyone with some advice today is at a minimum just calculate how much you might need and that certainly will go a long way toward improving your confidence levels.Totally agree, Bob. So, so Chris, we’ve covered a lot of ground. I’m sure there’s more ground that we could cover, but curious, uh, is there anything that we missed or anything that just bears re-emphasizing before we wrap up?
20:59 spk_1
Uh, you know, I would say that the, the 3, the 3 must, I, I’d say throughout your, your retirement journey, when, when you’re young, mid-career, late career.Uh, one, start early, even if it’s a small amount, and to take advantage of the free money that’s being made available to you by your employer or the federal government, start early, to stay invested. There are periods where people pull out for a few days and it was just the wrong decision, or maybe their employer defaulted them into a fund that was just not aggressive enough in, in, in that fund, or as you’re in retirement.Staying invested and not just moving everything to CDs, that’s very important to retirement as well. Uh, and then 3, I, I do really believe in the the role of a professional money manager when your early career, that could just be a target date fund that is professionally managed as your financial situation becomes more complex than having a professional advisor to work with can become more valuable to you. Those three things that encourage wherever you are in your journey can help you quite a bit.
22:06 spk_0
Yeah.So, Chris, uh, I wanna thank you for being a guest here on Decoding Retirement and sharing your knowledge and wisdom with our listeners and viewers. It’s uh so greatly appreciated. Thank you.
22:15 spk_1
Bob, thank you and thank you for doing what youdo.
22:18 spk_0
Thank you. So that wraps up this episode of Decoding Retirement. Thanks for listening. For this and more episodes, follow us on Amazon Music or just ask Alexa play Decoding Retirement. And don’t forget, for the latest retirement news and analysis, check out Yahoo Finance.com.
22:34 spk_2
This content was not intended to be financial advice and should not be used as a substitute for professional financial services.