Many parents want to maintain their independence as they age and do not want to reverse rolls and have their children care for them. Aging parents and finances can be tricky to navigate. The conversation can be awkward or be met with resistance.
A 2010 Investor Protection Trust Elder Fraud Survey, said that one in five Americans over age 65 had been victimized by financial fraud. You need to help protect your parents as they age and schedule time for those difficult conversations.
When to Take Action
Adult children should take note if a senior parent shows signs of forgetfulness, if they misplace bills and other documents and if they can’t retain information during a conversation. Forgetting or misplacing something infrequently is not the problem. The red flag appears when you have to explain something multiple times in a short time span.
Some other signs that your parents might need financial help are:
- Unopened mail and bills around the house
- Calls from creditors
- Making expensive purchases
- Complaining about not having money
- Need help with their checkbook
Ways to bring up the topic and avoid conflict:
- “I worry that…….” I worry that when you travel bills might get lost in the shuffle
- “I could take this off your plate so you don’t have to worry about it”
Organize their finances:
- Where are their current records?
- What accounts and balances do they have?
- What are their monthly expenses?
- What income do they receive?
- Set up a Durable Power of Attorney (POA) to support your parents in making health, legal and financial decisions
- Keep your parents informed
- Set up auto bill paying with their bank and let them see how their bills will be paid automatically
- Have transparency with your parents as well as your siblings
The Bottom Line
Being proactive is best; don’t wait for a crisis. Talk to your aging parents about money during calm times. To keep peace in the family, have an open, honest conversation involving your parents and siblings.