If you are lucky enough to have elderly parents, you know what a precious gift it is to have them. However, with this precious gift of time, there are some challenges that occur as they age and need your help. It is difficult when the roles of parent and child begin to shift and the children become the caregivers. One of the most complicated issues is when there is a need to take over your parents’ finances. Taking control can be awkward and complicated, but putting it off too long can make it very difficult to sort out all of their accounts and make the necessary legal steps to ensure your ability to successfully manage your parent’s money.
How do you know when it is time to step in? Watch for early signs that your parent’s cognitive ability is declining, and there is a need to step in and take control. If you wait too long, there’s a good chance that significant financial losses have occurred. Some of the signs to look for are:
- They become forgetful about cash
- They start getting calls from creditors
- Their house is filled with expensive new purchases
- They have difficulty with simple tasks like balancing their checkbook
- Bills have been paid repeatedly or not paid at all
- Bills that seem much higher than they should be and cannot be explained
- Donations to charity that do not match your parents priorities
Raising the topic might be difficult. Older adults may be resistant to relinquishing control of their finances. They may see this as the first step of losing their independence, which is one of the top two concerns for older adults. Prepare to Care: A Planning Guide for Families from AARP gives helpful insight on how to start the conversation. They suggest:
- Look for an opening: You might use an article you read about or something you saw in the news to raise the topic.
- Respect your loved one’s wishes: Your plan must be centered on the person receiving care.
- Size up the situation: Figuring out your loved one’s priorities help determine your next steps
- Counter resistance: Your loved one might say, “I just don’t want to talk about it.” Some people are private by nature. If your first conversation does not go well, try again.
Managing your own finances can be challenging enough, and you aren’t excited about taking on the task of managing your parents finances as well. Addressing the topic can be awkward, but if no one steps in to help, the assets that your parents spent a lifetime accumulating could be lost.
Written by: Kathy Green, Extension Educator, Ohio State University Extension, Clark County
Reviewed by: Michelle Treber, Extension Educator, Ohio State University Extension, Pickaway County