Aging Parents and Finances

What You Need To Know Before “They Need Your Help”

2 couplesBringing up fiancés with your parents now may be awkward, but it’s important and will benefit both you and your parents if you ever have to step in – to help manage their finances. Face it! It’s almost inevitable at some point where your parents are going to need your help with financial or health care issues.

If your parents are in their 60s or older, it may be time to speak with them about their financial affairs. If one or both of your parents become ill, incapacitated, susceptible to scams and fraud, or unable to keep up with their financial affairs as their mental and physical abilities wane, speaking with your parents about their financial affairs may be easier now in order to intervene and prevent problems if you speak to them regularly about their finances.

We understand this may be difficult in families where the subject of money was always taboo, but waiting until a crisis occurs can only cause stress, heartache, and money losses. Planning ahead helps ensure that your parents’ wishes, are carried out and reduces disagreements among siblings regarding exactly what your parents would want done. Don’t wait for a crisis to happen!

How do you approach this potentially awkward subject? Let your parents know that it will be easier for you to help them later when they need you – if they share the details about their finances with you now. If your parents are unwilling to discuss these details with you, at the very least they should tell you where they keep their important financial documents in case you need them in an emergency.

The time for preparing a “Powers of Attorney” and “Living Trusts” is to give someone else the authority to make decisions about financial affairs or health care before the need arises, and while your parents still have their mental faculties. If your parents aren’t mentally capable signing these documents, you may have to seek legal guardianship, which can be a long and painful process.

So exactly what do you need to know? Ideally, you should know the details of their assets and liabilities and income and expenses, as well as the answers to questions such as:

● Do they have a Living Will or Medical Directives? – Can someone speak for them in case
   they are unable to speak for themselves? Where is it kept?
● Do they have a “Durable Power of Attorney” – To handle their financial affairs if needed

 Other information you should know:

● Social Security Numbers.
● Details of Insurance Policies, including Health, Life, and Long-Term Care.
● Health Records, Medicare Numbers.
● Debts and Payments (Including automatic payments made from their bank accounts).
● Income, including Retirement Plans, Social Security, Annuities, Dividends, etc.
● Savings and Investments, including Bank Account Numbers and Names of Financial 
● Tax Returns. Location of Safe Deposit Boxes and Keys to the Boxes.
● Names and Phone Numbers of Legal Advisors, Doctors, Attorneys, Insurance Agents,
  Accountants, etc.

Remember: If it becomes necessary to take over the administration of your parents’ finances, it’s important to respect their rights and wishes. Give them as much control as possible. Keep their money separate from yours. Involve them as much as possible. Keep them informed!

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