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The issue of money can be sensitive for many people, thus adult children are frequently reluctant to ask about their parents’ earnings, assets, and investments. If you are unprepared for this conversation, concern and curiosity may be taken for insensitivity or even self-interest.
Learn how to have a financial conversation with your parents by reading ahead of time. Take into account the possibility that it may take mom and dad a few tries to get on board and engage in an honest discussion about legal and financial planning. Once you’ve made some progress, use this checklist to direct your presentation and make sure you cover all the essential components of a strong future strategy.
Ensure that you are aware of your parents’ desires, that they have taken the necessary legal steps, and that the person they have chosen to handle their affairs is capable and willing to follow their instructions. If their situation changes during such a trying time, your family would undoubtedly value clear guidance. These rules will also help to avoid conflict when feelings are already running high.
You should gently prod your loved one to speak even if they are reluctant to. Let’s consider a case scenario. Beverly’s parents’ house had burned down, and her father suffered serious injuries. Having the necessary financial and legal documentation would allow her and her siblings to deal with the aftermath and take care of their elderly mother.
Start the discussion early
Even though it might take some time before your parents need your help, start communicating right away. Inquire with your parents about who will take care of their business in case of trouble. The National Institute on Aging advises that parents give a chosen family member formal permission to speak with relevant professionals, such as doctors, financial advisors, and Medicare authorities, about their personal matters. Without this kind of planning, privacy laws can prevent important communication.
By starting regular communication now, you’ll be better able to understand their financial situation and determine your level of engagement going forward.
Whenever possible, push for change.
Instead of assuming immediate responsibility for your family’s finances, gradually start to assist where needed. For example, you should start by writing checks together if you’ve taken on the responsibility. Using a gentle, incremental approach gives your aging parents (and you) time to get used to the new situation.
Safeguard financial and legal records
Make a list of your parents’ addresses, phone numbers, account numbers, and the places they keep crucial legal documents such as birth certificates, insurance policies, deeds, and wills. Make sure everything is up to date, accurate, and that all of your accounts are in good standing. Whether you’re compiling this information or noting where your parents have put it, make sure any important information is kept in a secure location.
Simplify billing and assume financial responsibilities
After you’ve sorted things out, look over any income your parents may have, such as retirement or savings, and if you can, switch these income sources to direct deposit. In the event that your parents are unable to or forget to put money into their accounts, this will guarantee that they will still receive their funds. Set up online billing so that everything is paid automatically each month if they are forgetful about paying their expenses.
Think about a power of attorney
A power of attorney is a legal instrument that an adult signs to give another person the ability to make decisions on their behalf. There are many powers of attorney available that might be temporary, conditional, or comprehensive and cover financial, medical, and general issues. If you and your parents sign a power of attorney, you will have the legal authority to make decisions for them if they become incapable. For assistance in creating a durable power of attorney that satisfies your needs, speak with an attorney that focuses on elder law.
Communicate your concerns
Keep your family informed, especially your siblings and close aunts and uncles. Maintaining open lines of communication with relatives, who can be crucial sources of support, helps reduce the possibility of misunderstandings. Although managing your elderly parents’ finances can be challenging, you don’t have to do it all by yourself!
Maintain financial separation
No matter how easy it may appear, it is not a good idea to mix your finances with your parents’. You should always keep your personal assets and funds separate. Using your own money to help your parents is a slippery slope. You must be careful not to put your own retirement funds or savings at jeopardy while helping your parents.
Be wary of risky transactions
If you’ve planned ahead with your parents, you probably have a strategy in place for how to help them if they need it. However, it could be challenging to decide whether your intervention is appropriate or essential. These signs can be an indication.
Strange purchases: Pay attention if your parents start participating in lots of contests or sweepstakes or if they suddenly buy things that don’t suit their needs or way of life. The elderly are frequently targets of deception, and this tendency can quickly spiral out of hand.
Unopened mail can be a sign that your parents are making unusual purchases, falling behind on their financial obligations, or participating in contests.
Talking about money all the time: If your parents only talk about money when you’re around them, it could be a sign of a problem. They might say they don’t have enough money or avoid activities they think will set them back.
Physical challenges: Loss of vision can make it challenging to drive to the bank, and arthritis can make it uncomfortable to write checks or address letters. If you notice that certain tasks seem to be getting harder for your aging loves ones, it can be an indication that help is needed.
Memory problems: Cognitive lapses, such as forgetting where to put the dollar amount or what date to write on a check, are a crucial sign that you might need to offer your elderly parents assistance.
Want to learn more?
ConsidraCare’s live-in caregiver are trained to offer professional support to seniors as they begin to require more assistance. Please reach out to us at wecare@considracare.com or call us at 1-855-410-7971 to arrange care for a loved one.
