Be sensitive when helping seniors manage money
Money is a sensitive topic, so helping parents (or your spouse) manage finances requires a gentle approach.
If they’re forgetting to pay bills, making unwise purchases, or getting confused about their accounts, it’s probably time to step in. But even if they’re having problems, there can still be a lot of resistance. Be prepared to go slowly, keep them included, and be patient.
We’ve got 5 essential tips for helping your parent (or spouse) with their finances. The respectful approach reduces their defensiveness and this list gives you specific tasks to focus on, making the responsibility less overwhelming.
1. Respect their decisions
If your older adult is still able to manage their money, be respectful of their decisions and work with them instead of taking over. They’ll appreciate your help in executing the details and will be more likely accept additional help when they realize you’re not trying to take away their control.
If your older adult has dementia or a cognitive impairment, you may need to take over and make decisions on their behalf. It’s still kinder to make them feel included and in control, even if they can’t manage things anymore. Work with other family members to make sure everyone is on the same page and knows that you’re looking out for your older adult’s best interests.
2. Locate important documents
It’s critical to know where important financial documents are so you can locate them in an emergency. This allows you to protect your older adult’s assets if they’re not able to take care of things themselves.
Your older adult may be afraid that you’ll use these documents to take over, so be sure to reassure them that you’ll only use the information in an emergency.
Important documents include:
- Bank and brokerage statements
- Insurance policies
- Pension records
- Home mortgage or reverse mortgage
- Social Security payments
- Safe deposit boxes
3. Get access to financial accounts
Getting access to financial accounts requires some advance planning and specific paperwork. Banks and other financial institutions have strict rules about who can access accounts, sometimes requiring their own documents to be completed even if you have a Power of Attorney.
To write checks or withdraw money from your older adult’s accounts, you could become authorized to conduct transactions. In some cases, you may want to become a joint owner of the account.
For access to a safe deposit box, your older adult can authorize a “deputy” or “agent.”
Important: Before signing paperwork or getting joint access to any accounts, consulting with a financial manager, fiduciary, elder law attorney, or other qualified professional is always recommended.
4. Keep family informed
Your older adult should stay as involved in financial decisions as possible, but if you need to take full responsibility, it’s wise to share information with other family members or involve them in the process. This helps avoid conflicts later, like one person accusing another of inappropriately spending the older adult’s money behind the family’s back.
Holding family meetings to discuss finances is a good way to keep everyone up to date on spending and income. It’s also smart to keep a record of significant discussions, decisions, and actions in case there are disputes in the future.
5. Prepare for the future
If your older adult doesn’t already have a will or estate plan, now is the time to convince them to meet with a lawyer and start the process. These key legal documents are important because they affect how their assets are distributed when they pass away.
Managing finances is an important part of caring for an older adult. It can be tough to convince them that they need help, even if all the signs are there. These 5 important tips help you start off on the right foot.
This article is part of our Caregiver Beginner’s Guide series. For all 8 articles in this series, go to our Caregiver Guide Overview.
By DailyCaring Editorial Team
Image: Ventura County Star