As your loved one ages, they might experience changes that can impact their ability to care for themselves. When they have difficulty managing their finances, it could be time for you to step in. It is important to understand how to recognize signs of a potential problem, which steps to take to offer help, and when it could be time to consider long-term solutions. Here are some helpful tips and suggestions from Allen Gabe Law, P.C.
Recognize the Signs
It can be challenging to figure out when your older relative is starting to lose control of their finances. Fortunately, there are things you can look for that could indicate a problem. The following are potential signs that your loved ones may be struggling managing their finances:
- • Unopened mail: Bills or letters from creditors piling up could be evidence of neglected financial obligations.
- • Strange purchases: Frequent purchases of unusual or unnecessary items can indicate overspending.
- • Memory issues: Forgetfulness can lead to late or missed payments and potential loss of services or assets.
- • Physical problems: Difficulty writing out a check or addressing a letter can make paying bills an issue.
- • Expressing concerns about money: If your loved ones often express concern about not having enough money or avoid spending money, this could indicate financial difficulty.
The presence of any of these signs could mean your family member has trouble managing their financial responsibilities. Identifying when they might have a problem is essential for developing solutions to address the issue.
Offer Assistance
Even when signs are clear that your family member is struggling, they could resist your help. Life Beyond Numbers notes that there are several ways to offer support without compromising your loved one’s independence.
Try setting up auto-pay for essential, recurring bills, such as utilities, insurance, or mortgage payments, to ensure they don’t lose necessary services or default on valuable assets. You can also protect your relative by teaching them to recognize and avoid common scams.
For aging family members needing more assistance, consider obtaining a power of attorney, setting up a joint account, or taking over their financial tasks. Caring Village recommends documenting your actions and keeping a record of your loved one’s important documents and financial account numbers.
If your family member needs regular help, consider relocating. Moving into a house or apartment close to your loved one allows you to offer them the added time and attention they require as they age.
As mentioned above, your loved one may be resistant to your help with their financial matters. Taking these steps will help them ease in to accepting your help to better manage their finances:
- • Talk to them: You should initiate a conversation with your loved ones before they need help about who will manage their finances when they do need help. It is best to get written consent from them to designate a family member to take over their finances and allow them to discuss personal matters with their doctors and financial professionals. Having these conversations earlier will help you better understand your loved one’s financial situation and prepare them to accept help when they need it.
- • Make changes slowly: You should start small with your support and gradually increase your involvement instead of taking over and making sweeping changes. You can start by taking over a couple duties and do them together with your loved one. This allows your loved one some time to get comfortable with you helping with their finances.
- • Take inventory of financial documents and accounts: Make sure you get the account numbers for all of your loved one’s financial accounts as well as where they keep important legal documents like deeds, wills, birth certificates, and insurance policies. Check their accounts and legal documents to ensure everything is in good standing and up to date.
- • Streamline income and bills: If possible, switch your loved one’s source of income, such as retirement, to direct deposit so the funds automatically go to their accounts. You can also set up autopay for their bills to ensure they are always paid on time.
- • Consider a power of attorney: You and your loved ones can consider granting you power of attorney, so you have the legal authority to make financial or medical decisions on their behalf. Your loved one must be competent enough to sign a power of attorney document and you can design a power of attorney to be temporary or limited in scope as well as more complete. An elder law attorney can help you draft a power of attorney document that suits your needs.
- • Document everything: As you take over more of your loved one’s finances, make sure to document everything you do and inform your loved one of every move you make. This helps avoid misunderstandings and keep your loved one aware of their financial situation.
- • Separate your finances: You should manage your loved one’s finances separately from your own. Do not mix your finances or use your money to help them as you may find more of your funds getting mixed up with theirs. Keeping your finances separate also helps you stay on track with your savings and retirement goals.
Consider Long-Term Solutions
Your loved one could eventually need a long-term solution. Depending on the extent of the problem, it might be time to discuss assisted living options. This can be a challenging conversation, so approach the topic carefully and consider your loved one’s feelings. It’s a good idea to include them in the search for facilities, which can be done online; you’ll find nearly 80 skilled nursing facilities in the Chicago area.
If your aging relative is transitioning to senior living, they might need help selling their house or business. Using a home proceeds calculator to estimate the associated costs can give you a clear idea of how much you can earn from the sale.
When selling a business, ensure your loved one gets paid fairly by hiring a valuation service to discover the value of their company. Business valuation companies factor in inventory and assets to determine how much a business is worth.
There is nothing easy about watching a family member lose the ability to manage their finances. Recognizing the signs can make it easy to offer assistance, but prepare for possible resistance as money can be a sensitive subject. If you notice changes in your loved one’s behavior, it could be time to take action.
Allen Gabe Law, P.C. is dedicated to serving client’s legal needs by providing comprehensive legal counsel in the areas of family law, litigation, real estate law and corporate law. Connect with us today by calling (847) 241-5000, Ext 121!
