Helping Aging Parents with their Finances

Discussing finances is never easy, and if you are an adult child, finding a way to ascertain your elderly parent’s financial health can be difficult. There are questions you can ask to help ensure your parents’ financial security without overstepping your bounds as their child. It can be an uneasy discussion, but the ramifications of not having it are worse. Before you get started, here are some areas to consider discussing.

Be Respectful

It’s important to be sensitive to and respectful of the delicate nature of your parents’ financial as well as emotional needs. Not being able to maintain their financial independence as they get older can be frustrating and disappointing for them.

Organize Essential Financial Documents

Knowing where essential personal papers, such as birth and marriage certificates, social security cards, life, health and property insurance policies, and mortgage information are located is a first step in helping your parents with their finances. It’s important for you to know where the documents are kept for easy access.

Make Lists of Financial Activities

Make a list of your parents’ income and expenses. You should know if your parents receive a monthly pension, disability or government assistance. Make sure that you know their expenses also, such as car and mortgage payments. List their bank and investment companies’ information to include PIN numbers and account numbers.

Organize Estate Planning Documents

If you don’t already know, find out if your parents have last will, living trust, living will, or power of attorney and where the originals and copies are located. If they don’t have these documents it’s important to work with them to create them. A last will is an essential estate planning tool. A living will is also an essential estate planning tool.

Create Durable and Health Care Powers of Attorney

Granting someone a durable power of attorney (appointing a person to execute financial decisions on their behalf) and a power of attorney for health care (appointing a trusted person to make health care decisions if they are unable to) are both important steps to estate planning. Having these people in place before the need arises is invaluable.

Involve a Financial Expert

If your parents’ financial situation is more complex than you or they can handle, you might want to consider hiring a financial planner, accountant or an attorney. In some cases, a money manager might be needed to help establish a budget.

The best time to discuss finances with your parents is when they are competent, self-sufficient adults. Planning ahead and seeking out the appropriate professional financial assistance on their behalf can help ensure your parents enter their golden years in the most comfortable, stress-free and secure way possible.

Contact CMM today for any questions regarding your parents finances!