Dealing with elderly parents can be a real challenge. Many seniors today are fiercely independent and insist on making their own decisions about everything. As long as they are capable of doing that, most families are content to allow them to manage their own lives. There may come a time, however, when the adult children need to step in and take control over certain aspects of an elderly parent’s life — and that can be a difficult moment for everyone.
When to Step In
One of the most difficult decisions a person can make is when to step in and take over the control of their parents’ lives. They have lived on their own for many decades. They have made more decisions about their lives than you have — in fact, they took care of you for many years before you were ready to move out on your own. So taking charge of an elderly parent’s life can be a difficult and challenging time. Unless they have a medical condition, such as a stroke or other health issue, that limits them severely, you don’t need to take over every aspect of their lives. Deciding to take over their financial affairs may be one of the last things you do. You may want to do it gradually, allowing them to remain involved in the decision-making process. That way they still feel like they are in control, even though you are guiding them on how to make certain financial decisions. Helping them with retirement planning can be extremely helpful for everyone.
Steps to Helping Your Parents’ Finances
Making decisions about helping an elderly parent should actually begin long before retirement. Planning ahead while everyone is still thinking rationally can be very helpful in establishing a plan for the senior’s future. Here are some helpful tips for retirement.
- Make a list of assets. Before they retire, they should begin compiling a list of assets, bank accounts, savings and investments, insurance policies, and any other valuable item. Your goal is to have a complete accounting of what they have so that if the day comes when they become forgetful, you don’t need to rely on their memory. This can be extremely helpful if assets need to be sold off to pay for nursing home or other long term care.
- Automatic deposits. Make sure that any money they receive from retirement accounts or other income is deposited automatically into their bank account. This way they don’t accidently lose their checks before getting them to the bank.
- Duplicate copies. You should make arrangements for your parents’ financial institutions to send duplicate copies of their monthly statements to you. If the bank or credit union uses electronic statements, get placed on the email list so that you can monitor your parents’ finances.
- Review insurance. Go over your parents’ insurance policies and healthcare plans. By having access to this information early, you can monitor their policies to make sure they have adequate coverage for their future needs. It’s much more difficult to get new policies after they have reached retirement age.
- Establish a plan. Now is the time to talk to your parents about how you will take over their finances and when. Set some milestones concerning age and physical condition. It is better to talk about those things when everyone has their full mental faculties, rather than waiting for age and dementia to interfere with rational thought.
By following these basic money management tips, you can do a lot to help keep your parents safe and out of financial difficulties. If everyone understands the plan ahead of time, it makes for smoother transitions later in life. Put the plan in writing so that you have something to refer to later on and in case there are any disagreements.
Watching Out for Elderly Parents
Those senior years are supposed to be spent relaxing and enjoying life. If there are constant concerns about finances and other matters, life can quickly become disheartening and frustrating. One of the best things you can do to help watch out for your parents’ well being is to keep an eye on their credit report. When you have a credit check regularly, you can see how they are doing with any debts they may have and ensure they aren’t falling behind on payments. You can also watch for signs of identity theft or credit fraud.
Getting older doesn’t need to be difficult. By establishing a plan early on, and by doing what you can to help them keep track of their finances, you can set them on a relaxing road in their retirement years. By checking their credit history with them you can monitor their debt management and keep them from getting into serious financial trouble. While you’re at it, you may want to check your credit history, as well; especially if you haven’t checked for a while. It’s always better to be safe!
About the author: Joy Mali is an active finance blogger who is fond of sharing interesting financial management tips to encourage people to manage their personal finances.
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Dealing with elderly parents can be a real challenge