When They're Just Too Frugal

Excessive frugality in older adults can sometimes hinder their access to social activities, necessary medical care, nutrition, or essential services, potentially compromising their overall health and well-being. This can increase the risk of isolation, reducing the overall quality of life.

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When They're Just Too Frugal
5 Min Read October 5th, 2023

"My mother-in-law is just plain stingy," Jackie fumed. "She has plenty of money but refuses to let paid service workers help maintain her home, her yard, or her car. She tries to do everything herself and insists on having my husband and me do everything else. I'm beyond frustrated."

Some seniors hoard rubber bands and used tea bags, live in a house with a roof like a cheese grater, and wear the same tattered sweater they bought at a garage sale twenty-five years ago. And do so with obstinate pride, as if the more they do without, the more virtuous they are. Their healthy bank account belies the need for over-the-top thriftiness, but they still cling to every penny as if it's their last. It makes no sense.

Or does it?

Great Depression Defined a Generation

Whether they remember it personally or not, the Great Depression defined a generation. Even those who came along afterward were shaped by parents who felt its shadow hanging over their family. In their economy, safety meant saving. Making it meant making do. And no amount of later prosperity could erase the imprint of scarcity tattooed on their psyche.  

Now, in retirement, seniors are likely faced with a fixed income or withdrawals from a finite reservoir of savings that's non-renewable, even if ample. The fear of running out can trigger their deepest insecurities, causing them to double down on their go-to defense: excessive frugality.

An article in U.S. News and World Report cites the income transition in retirement as a common source of concern. 

For workers who have earned a paycheck for decades, the shift to using income from retirement accounts can be difficult. When people start paying themselves, they get scared.

In addition, it may be a difficult pivot to start drawing down reserves that took a lifetime to build up and were once considered off-limits.  

The article goes on to point out that beyond the obvious reduction of personal enjoyment, seniors may delay important preventative care or withdraw socially in a misguided effort to save money.       

Anxiety About Not Having Enough

Fear of an unknown future is not irrational. Taken to its extreme, however, seniors' driving anxiety about not having enough is detrimental not only to them but to their loved ones and caregivers. It can have broad-ranging negative impacts on their relationships and health, as well as their lifestyle and sense of well-being.  

Gina returned from a visit to her parents and felt like she was losing her mind.

Spoiled vegetables in the refrigerator, stale crackers, and spices from 1996. When I arrive, I quietly throw things away that she refuses to get rid of. I took her to the discount grocery outlet that she favors. It broke my heart to see her shop like this, even though Vons is across the street, and she could easily get fresh food there.

I drove my mother every day in their one car. The defogger didn't work, the tires were bald, and the roof leaked on us when it rained. My dad had balked at any mention of repairing things.

She acknowledges that her parents chose to live cheaply even though they would be considered well-to-do and could afford to live more comfortably.  

Helping Seniors Remain Healthy and Independent 

Certainly, not all families have abundant resources available. Those are a different set of issues that we'll address in another article.   

Faced with this problem, though, the challenge for loved ones is to help seniors remain as independent and healthy as possible without shouldering a greater burden than needs to be theirs.

Here are some ideas:

  1. Take a walk in their well-worn shoes. Chat about their family's money culture growing up and how it affected them as children and then as adults. Try to understand their motives and their rationale. Empathy helps take the edge off frustration. 
  2. Make decisions together. Are they shopping for something they need? Advise and help evaluate the options ("This one comes with a better warranty"), but honor their preference even if you disagree. 
  3. Create a budget. Chances are, they have both guaranteed and discretionary sources of income. If they see that necessary expenses are covered by reliable income, they may feel better about dipping into accounts that were previously untouchable. 
  4. Let them boast. My mother-in-law likes to talk about how she sewed her own clothes and paid for their Florida vacation by clipping coupons. She'll vent over "wasteful" spending on things like thoughtful gifts. You can praise her achievements while helping deflect the negativity.   
  5. Have the Talk. If you suspect the way they handle their money is becoming harmful, you may need to discuss allowing a trusted family member access to their checking account. Are bills going unpaid? Are they putting off basic health care? Bring in a professional (social worker, financial specialist, etc.) to help. You may meet resistance, but don't be afraid to revisit as the dynamics change.   
  6. Set boundaries. Jackie's husband may have to tell his mom, "I don't have time to mow your lawn every week. I know a good gardener who can come over on Tuesdays at a fair price." Don't ask. Just tell her this is how it is now. If she balks, let the grass grow. 
  7. Recognize their handicap. As Gina put it, "Cheap hurts, it insults. Cheap wastes time and money. Cheap is ugly, twisted, and selfish. Cheap steals, robbing happiness. Cheap is an illness." Frugality taken to the extreme can be considered a psychological impairment, no less than dementia or chemical dependency.     
  8. Accept them. You're not going to change their mindset. But you can accept their reality without letting it infect you. Remind yourself of the good things you love and enjoy about them. Celebrate and focus on those.   

Parents sacrifice to give their children everything they can. Despite her parents ' dysfunctional view of spending today, Gina recalls being raised with kindness and generosity.   

Letting Go of Control

Ultimately, the question distills down to trust. Seniors may fear that their survival is still up to them that letting go of control will leave them destitute and deprived. By showing up consistently and calmly, their loved ones may be able to help ease their concerns and free them to trust that they will always be provided for, resulting in a more comfortable and satisfying retirement. 

Leslie McLeod helps families navigate drama and keep peace as they care for their aging parents. A downloadable resource, Six Tips for Dealing with Overly Frugal Parents, is available along with additional resources at  https://mailchi.mp/lamcleod.com/frugal.

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About the Author

Leslie McLeod is a California artist and writer, helping families navigate drama and keep peace as they care for their aging parents. www.lamcleod.com

LTC News Contributor Leslie McLeod

Leslie McLeod

Contributor since May 31st, 2021

Editor's Note

In the realm of financial planning, frugality is often lauded as a virtue. Especially for older adults, adhering to a strict budget can seem like the most prudent approach to ensure that savings last throughout the retirement years. However, when this frugality blinds one to potential future risks, it can become a liability rather than an asset.

One significant oversight in many retirement plans is the cost of long-term care. As people live longer lives, the chances of needing assistance with daily activities or requiring supervision due to cognitive decline increase. Such care, whether provided at home or in specialized facilities, comes with a hefty price tag. Medicare provides limited coverage, and personal savings can quickly be depleted by these unexpected costs.

By avoiding or delaying the consideration of Long-Term Care Insurance, individuals may find themselves unprepared for these expenses, placing a financial burden on their families or reducing the quality of care they can access. Obtaining a Long-Term Care Insurance policy is not just about protecting personal assets—it's about ensuring choice, dignity, and quality of care in one's later years.

Incorporating Long-Term Care Insurance into a comprehensive retirement plan addresses these potential blind spots. It's not just about being prepared for today but also for the uncertainties of tomorrow. While frugality has its merits, true financial prudence lies in anticipating needs, understanding risks, and preparing comprehensively.

Most people get their coverage in their 40s or 50s to take advantage of lower premiums. 

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These professionals possess extensive knowledge and expertise to guide you in choosing a policy that aligns with your needs and financial capacity. They can provide accurate quotes from leading companies due to their experience and training. This differentiates a specialist from other financial professionals like general insurance agents, insurance company captive agents, and financial advisors. 

A specialist with a CLTC designation has undergone intensive training centered on long-term health care planning. They possess deep knowledge of policy intricacies, understand the underwriting standards across various insurers, and are familiar with both federal and state regulations overseeing these policies.

Keep in mind there are very experienced specialists who do not possess a CLTC designation, just like there are those who do have the designation but have limited experience. 

Be sure you ask questions about their experience and the number of insurance companies they represent. Experience is less about the number of years a specialist has been working in the industry and more about the number of people they have helped. Top specialists help hundreds of people every year and are independent -- represent the top insurance companies that offer these products.

Long-Term Care Insurance is highly regulated, and Long-Term Care Insurance specialists understand the importance of products that meet federal guidelines. 

Not every agent or financial advisor that claims to be a specialist is one.

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These four guides can be very helpful as you try to find appropriate long-term care services for a loved one:

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