Caring for an aging parent is a common challenge for Baby Boomers, and now even Gen-X’ers and Millennials. And, stepping in to help manage your parents’ finances, without eroding their sense of independence and privacy, can be tricky.
Many aging parents are reluctant to ask their children for help with their finances. It means a loss of control, a trading of places from them taking care of you to you taking care of them, and can signify a loss of power that feels too frightening for your parents.
Nevertheless, you may be wondering what you can do when your parents start needing help.
A pile of unpaid bills, threatening calls from creditors or repeated instances of credit card fraud or financial scams are good indicators that your parent needs help managing his or her finances.
Financial caregiving is easiest when you already have a plan in place. You may be in a good position to make educated decisions about their finances, but without the proper information and legal authority, your options are limited.
If your parent needs help, the first step is to make sure you know what they have, where it is, and how you can access it, if necessary.
Next, you want to make sure you know what bills are due, when and that their bills are being paid on time.
Unless you have the legal authority to manage your parents’ finances, you will need their help in getting access to their account and setting up auto-bill pay for them.
When you are ready, the first place to start is with a heart to heart conversation about whether your parent is ready for help and what that help could look like.
Then, if your parent is ready to help, you can ask him or her (or them) to legally designate you as either the Trustee of their trust or financial power of attorney holder, if they do not have a trust. And, be sure you are also designed as medical power of attorney, so you can make important care-giving decisions for your parent(s) if he, she or they cannot.
If your parent needs or wants help with finances, he or she may also need help with health care or the management of their estate. You can address these issues by working with one of our lawyers who will help you develop an estate plan that considers your parent’s best interests. As your lawyer, we work with your family to ensure you have the authority required to help your parent with his or her finances.
This is also an opportune time for you to consider your own long-term financial planning. If you are ready to take a step toward financial peace of mind, begin by scheduling a Family Wealth Planning Session. Before the session, we’ll send you a Family Wealth Inventory and Assessment that will get you thinking about what you own, what you want to leave behind and how you want your finances to be managed if you need help. As your lawyer, we’ll help you establish a plan for your finances to ensure you have a plan in place when you need it down the road.
This article is a service of Kundani& Chang LLP. We are an award-winning law firm that specializes in business and estate planning for clients like you. The goal for every family is to stay educated on all topics like this, avoid probate, avoid estate taxes, and build a legacy for you and your loved ones. What sets our firm apart is that we build lasting, lifelong relationships with our clients. They rely on us to keep them updated, provide sound legal counsel, and be there for them immediately if any problems should ever arise. The best part is we don’t charge hourly fees to our families, so you never have to worry about speaking to us. If you’re ready to keep your family out of Court, contact us today to schedule an initial consultation or visit our website at www.kckwlaw.com.