We always want the best for our parents, especially as they get older. If you’ve noticed signs that they could need financial help, like forgetting to pay bills or careless spending, it may be time to step in.
However, if you’ve never handled financial matters like this before, you may need a little guidance. Here are some important ways to provide financial help for your parents:
1. Have the conversation
Money can be a sensitive subject in some families. However, if you feel it’s time for your senior parents to hand over control of their finances, the first step is talking about it.
Here are some points to consider:
Extend a loving invitation — Explain that you want to have a stress-free chat about the future of their financial matters. You can set up the talk at one of your homes or maybe a favorite restaurant.
Be specific about your concerns — In a non-judgmental tone, explain exactly what you’re concerned about. Use examples to show the cause of your worry and share the potential negative outcomes if things went wrong.
Have a plan — Your parents may be more receptive to financial help if you have a plan in place. Describe exactly what you’ll help with, when you’ll start and how you’ll see it through.
Be brief — Try to keep the conversation under 20 minutes. That should be enough time to express your concerns and lay out your plan without making it overwhelming.
2. Gather financial documents
From applying for health benefits to moving to a senior community, there are many situations that require financial documents. There are also emergencies that can pop up and don’t allow for time to search through boxes or wait in line at a government office.
To avoid any stress or delays, the best approach is to locate and organize all important financial documents immediately. Where you choose to store them is up to you, but make sure it is secure and easily accessible. Here’s a list of documents to keep safe and ready at all times:
- Last will and testament
- Checking and savings account statements
- Savings bonds and stock or brokerage account statements
- Retirement or pension records
- Social Security payments
- Insurance policies
- Deeds to property
- Vehicle title
3. Research public benefits
Many federal, state and local government programs are available to seniors in their 60s. For example, Social Security benefits can be withdrawn as early as 62 years old (with a penalty) or as late 70. The first chance to get Medicare coverage usually starts three months before a person turns 65 and ends three months after they turn 65. And if one of your parents served in the military, veterans and their spouses may qualify for a variety of special benefits.
To get started, you can gather all their personal, health and financial documents. Next, go to BenefitsCheckUp.org and see what benefits your parents are eligible for. BenefitsCheckUp is a free service of the National Council on Aging (NCOA) and searches over 2,500 federal, state and private benefits programs based on the credentials you enter. If your parents do qualify for certain benefits, you can apply for many of the programs online or mail in the application forms.
4. Assign power of attorney (POA)
If your parent is having difficulty making critical decisions, it may be in their best interest to assign power of attorney (POA) to you or a loved one. Power of attorney is a signed, legal document that allows another person to make your legal, financial, business and health decisions. It can be used for one specific issue (financial matters) or provide the right to handle all personal affairs.
5. Recruit family assistance
If you feel overwhelmed adding these financial matters to your home and work life, it may be in the best interest of everyone to recruit family assistance. Siblings and close family members can split up the responsibilities and help balance the load. Plus, some people may have experience with certain tasks or be more qualified to handle sensitive information.
Here are some typical affairs that family members could divide:
Monthly bills and financial accounts — Who in the family is the best at money management? This task could cover duties such as monthly bills and all financial correspondence. Be aware that some affairs may require a power of attorney.
Living arrangements —There may come a time when a parent can no longer live on their own. This may involve moving parents in with a family member or admitting them to an assisted living facility.
Caregiving arrangements — If necessary, can your family afford full-time medical care? If not, you may want to consider searching for a job with a company that provides working caregiver benefits such as flexible work arrangements, resources and emergency backup care.
6. Seek professional assistance
If you don’t feel comfortable with money management or legal matters, it might be beneficial to hire a financial advisor for certain tasks. Missteps with investments, taxes or hospital bills could result in heavy damages for your parents and you as well. Hiring a financial planner, accountant or daily money manager can lessen the risk of mismanagement and give you more time to focus on other duties.
Also, see if your employer offers an employee assistance program (EAP). An EAP is a counseling and referral service that helps employees who are having a difficult time at work and/or home. While most services may be tailored toward your own personal life, some may also provide you with legal advice, financial advice and elder care referrals for your family.
Take things one step at a time
Helping your elderly parents with finances can be a lot to handle at first. You may not have experience with certain money or legal matters, but you can accomplish these tasks with patience and commitment. Most of all, remember why you’re doing it and who you’re doing it for.