Control of finances ranks with driving a car as a critical symbol of independence for older people. The perception of coming between elderly parents and their finances can become a significant issue for adult children.
No one wants to feel forced into doing something they are not ready for. Older people are certainly no different, especially with something as important as their finances. As adult children, we want to help our parents with all that we can, but doing it strategically is important.
7 Tips for Making an Important Difference with Elderly Parents and Their Finances
- Address the issue casually, as opposed to announcing that it is time to take over your elderly mother’s or father’s finances. Find opportunities to bring up the subject in a more general manner by asking if he is having any issues where you can be helpful. Bring up the subject carefully, but often over time will help to make the discussion more acceptable.
- Encourage your elderly parent to use the services of an accountant, tax preparator, and/or financial planner who is familiar with issues relevant to older people. Ask your parent to include you as someone who can communicate with the professional on issues related to his finances.
- Keep management of finances as a shared responsibility. Sit with your elderly parent to pay bills and review bank, annuity, and other financial statements. This will help him maintain a sense of control.
- Keep hard-copy records of important documents or create electronic files on the computer. This will aid in making information quickly accessible and trackable. Create a spreadsheet of what documents are being tracked to refer to when needed.
- Try to simplify bill payments, direct deposits, and other regularly occurring transactions by setting up automated processes. This will reduce the time needed to maintain your elderly parent’s finances and reduce the likelihood of mistakes.
- It may become necessary to be named as power of attorney for your elderly parent. The power of attorney process will be easier to navigate if you have already established a supportive relationship with your mother or father. There are a variety of power of attorney mechanisms related to financial, medical, and other issues and they can be short- or long-term. Discuss the power of attorney thoroughly with your elderly parent. Include an accountant, attorney, or other professional in the conversation if needed.
- The relationship you have developed with an elderly parent regarding his finances needs to be transparent. You, as the adult child, need to protect yourself against any misunderstandings about what is being done. Keep documentation of decisions made. In addition, never combine your elderly parent’s finances with your own and resist the temptation to pay his debts with your money or even borrow money from him. Do not turn your efforts to help into a liability for you.
Planning is critical in successfully helping your elderly parent with finances. Begin informally and carefully and then increase your support as his needs expand. Click here to check out this informative article from AARP regarding the issues surrounding elderly parents and their finances.
Protecting elderly parents can be a critical and, at times, challenging process for adult children. Check out this earlier blog “Elderly Parent Driving” to learn more about addressing issues with driving. Also, if you want to arm yourself with the information needed to motivate an elderly parent or friend to remain active and exercise, take a look at this new e-book by clicking here.
Learn more about blog creator Steven Watson’s background related to helping elderly people remain active and safe by clicking here to access his Amazon Author’s Page.