The hints have been there for a while…your mother keeps forgetting appointments, your dad can’t find his checkbook, the bank calls you about some missed payments. Even though most of the time your aging parents seem perfectly capable of handling their own financial affairs, you know there will be a time when you must offer (or maybe even strongly suggest) to help them with these matters.
As people live longer and families live far away, it is difficult to know when you must step in and help your parents. If you find yourself in this situation, act now, while they can still answer important questions and can sign documents you will need. It is so much easier to arrange financial papers and accounts before they are in the hospital or their memories become confused.
This will undoubtedly be a sticky situation, so don’t try to take over everything at once. Don’t be surprised if your parent denies there is any decline in their cognitive abilities or in the ability to handle money. So the best time to bring this up is before confusion or memory loss is an issue. You can begin with offering to help with the tax return. From there, you might move on to ask to see the checkbook or the online checking account. After that, you may find they need help making payments. Either by check or online, and you can help keep track of those. The last thing you want is for your parents to think you have taken control of their money away from then.
Although I have not found this to be very reliable, you might try the “do not call” registry. That way, you may stop some unscrupulous telemarketers from calling your parents and offering financial help. Remind them that there are many, many scams out there and that they should never give financial information, social security or credit card numbers to strangers. It may seem obvious, but we all know of people who have lost everything to a charming stranger who assures people they will make more money if they only invest with the caller.
Let’s assume your parents are both retired and moving to a new place, either an assisted living complex or some kind of senior residential situation. Once it has been determined that they are actually leaving their current home, be sure to cancel recurring charges such as newspaper delivery, health club, cable TV, phone landlines, automatic payments to Fast Track, E-Z pass or other bridge and tunnel payment plans. Often people have setup a monthly payment plan to a favorite charity; if this seems like an extravagance right now, or your parents are no longer interested in that particular institution, consider canceling that as well.
Will they still be using email in their new living situation, will all their credit cards be necessary, is there a local safety deposit box they will no longer need? Will they need to change banks? What about car payments? If one or both of them are still driving and they are taking the car with them, make sure the insurance and car payments are up to date. If they are moving from one state to another, find out the rules for the two states. Some states require that you send the actual metal license plates back if you move out of state.
Now the real money issues. If you find that your parents have a diverse portfolio of investments, including partnerships or non-publicly traded stocks, try to reduce the number of accounts and simplify the investments. It will make it easier for all involved if the investments are all in one place, as even a completely savvy 85 year old investor may sometimes get confused if there are myriad accounts and retirement accounts.
Once your parents have agreed to let you see their finances, keep your own list of the different accounts and passwords. If they still live far from you, consider hiring a local financial planner or money manager to keep track of their daily spending and help them pay bills and deposit checks.
Be sure to get a power of attorney as soon as you can. You may find that each financial institution or investment account requires a separate form, many of which will need to be notarized. So again, try to do this before you need to and when your parent understands what you are doing is for their future peace of mind.
Don’t wait until there is a crisis. It is much less disturbing for both you and your parents to begin to deal with this sensitive issue while they are still healthy. Only they know where all the accounts are, which passbooks are obsolete, or which accounts they use for daily expenses. It will definitely be a challenge to persuade your aging loved ones that they may need help, but all of you will feel better once the offer has been made and accepted.