What is the right age to begin to talk to your parents about protecting their finances?

[Anonymous]

POA, Trusts, etc?

[Anonymous]

Um. Never.

[Anonymous]

Anonymous wrote:Um. Never.

Um. What.

[Anonymous]

Any age is good to broach the topic of the future. Although some families are weird about things like that.

In terms of taking over the responsibilities, I don’t think it’s as much about age as it is ability. Pay attention and when it seems like they may be starting to slip a little broach the topic.

[Anonymous]

always best when everyone is still competent. if you don't know how to broach the conversation, you can start by asking for help: "larlo and i realized we need to plan for the future and get our paperwork in order-- our finance guy says we need our wills updated, and make trusts, and do advanced directives and healthcare PoA as well as durable power of attorney. it all seems so overwhelming. he says he can recommend some family lawyers for planning, but i wanted to ask you what YOU did. do you have a lawyer you work with?"

if you think things might be complex, or that parents might need medicaid at some point in the future, then you'll want to talk specifically to lawyers that specialize in medicaid/eldercare planning, but first things first. start the conversation. dpoas can be constructed to name successors, so maybe they just want to be each others poa for now, that is a good start.

once talking about finance, it can be good to talk about budgets and autopay and any critical recurring payments. here you could frame it again as asking for help. "i was using this application called Mint for my budgeting, and they are shutting down! do you use anything for budgets, planning out recurring expenses? no? oh. maybe we could research together?"

good luck.

[Anonymous]

Here's the problem, from my experience. Getting a POA and trust set up (along with advance medical directive etc) is good, but it's not really enough to protect a parent's finances.

What you really need to do is have a sit-down with them every six months and go over everything - their bank accounts, their spending, their credit card bills showing what they spent where, their retirement account balances, etc. That way you will be able to see if they are pissing away their money on stupid stuff or getting scammed. One example - my mom kept signing up for all these stupid financial newsletters that were on auto-renew and that came to something like $300/month when you added it all up. And she kept basically day trading - she'd read something about palladium being a good investment and she'd run out and buy some palladium.

Unfortunately it is not guaranteed you will be able to stop your elderly parents from pissing their money away, but at least you will know about it. Not impossible they will resent this effort to protect them, but you have to try. Both my mom and my FIL went off the rails financially later in life. I had to take charge of their finances completely - as in, I control their spending, I get their bills and pay them, and I took away their credit cards. This happened after they'd already wasted hundreds of thousands of dollars, and I wish I'd done it years sooner, but I had no idea how bad they were screwing up. In my mom's case, I attribute this mostly to medical issues, and to the overuse of lorazepam, which turned her into a zombie until I put a stop to that, too.

[Anonymous]

Anonymous wrote:Here's the problem, from my experience. Getting a POA and trust set up (along with advance medical directive etc) is good, but it's not really enough to protect a parent's finances.

What you really need to do is have a sit-down with them every six months and go over everything - their bank accounts, their spending, their credit card bills showing what they spent where, their retirement account balances, etc. That way you will be able to see if they are pissing away their money on stupid stuff or getting scammed. One example - my mom kept signing up for all these stupid financial newsletters that were on auto-renew and that came to something like $300/month when you added it all up. And she kept basically day trading - she'd read something about palladium being a good investment and she'd run out and buy some palladium.

Unfortunately it is not guaranteed you will be able to stop your elderly parents from pissing their money away, but at least you will know about it. Not impossible they will resent this effort to protect them, but you have to try. Both my mom and my FIL went off the rails financially later in life. I had to take charge of their finances completely - as in, I control their spending, I get their bills and pay them, and I took away their credit cards. This happened after they'd already wasted hundreds of thousands of dollars, and I wish I'd done it years sooner, but I had no idea how bad they were screwing up. In my mom's case, I attribute this mostly to medical issues, and to the overuse of lorazepam, which turned her into a zombie until I put a stop to that, too.

This is all so true. The problem is with things like dementia sometimes they completely lack self-awareness and there seems to be this time-frame where they can pass a dementia test, but are clearly impaired to anyone who knows them well. So you may discover obvious fraud and they are convinced the woman on the internet is their fiance and then YOU are accused of money fraud. Or..the parent who was so careful with money and thrifty is suddenly falling for scams, but won't allow you to take over and while they will fall for a stranger's stories, nobody in the family is worthy of managing things. If you go the route of getting them declared incompetent, you may unleash the wrath of a thousand lions. I've heard it all and I am always so relieved when a friend has an easy experience.

[Anonymous]

For us, it was when Mom sort of started to accept that Dad's parkinsons was advancing faster. Brother and I had wanted to have this conversation years before-not to know their business or inheritance blah blah blah, but really because if something happened to Mom, Dad can't cognitively handle it and he needs a full time caregiver physically.

I finally got them to see an elder atty (recommended by my divorce atty) and they did POA and a trust for the house. THANK GOODNESS they did this because about 3 months later...Dad fell while Mom was helping him put on shoes and she broke her hip and they were both hospitalized! I needed and used the POA then.

But they hadn't added me to a bank account, and I literally was paying their elec bill and the landscaper out of my own cash just to keep the house running (they had to go to rehab). So now I'm on a small account so I could at least pay bills if I ever had to again-and if something happens to Mom I have to step in right away. You really don't realize about that until it happens. You need to pay certain things quickly or you won't have water or lights.

My parents have always been good with money and never scammed, but I do regularly chat with them about scams "if you get a phone call from one of my kids saying they're in jail in mexico and need money, don't do it!!! it's a scam, Call me' just so they are aware of scams out there.

[Anonymous]

How receptive are your parents to help generally? My mother loved all things financial, but when my dad died, there was a lot of administrative stuff to deal with, and she decided to hire an accountant and turn stuff over to them. She still likes to check on how her investments are doing, but it's optional now, as long as she's willing to pay for it.

She lives in a retirement community that sends regular notices to residents about what the latest scams are. I think it helps that it isn't her kids warning her, which can come off as us thinking she's losing it, and instead is just warnings Other People (winky face) need.

[Anonymous]

You're being too vague Op

[Anonymous]

Do you *really* know more than they do, Op?

[Anonymous]

Anonymous wrote:POA, Trusts, etc?

When you’re old enough to know what those are.

[Anonymous]

My mother brought it up to me and my siblings at various points as she aged. I was on her bank accounts for about 30 years, then on various other things and took care of PoA.

[Anonymous]

I think at any age it is not out of bounds to have a conversation perhaps on both ends of just how prepared is a couple or an individual if single financially and legally for the future covering such topics as needed because:
- At age 18 one becomes a legal adult and parent input is severely limited in medical and legal decision-making unless certain steps are taken.
- At age 26 when the option to continue on Family Health insurance comes up, it is important to know options, including COBRA for up to another 3 years if it is important to keep a good policy. And to help the young adult transition to an individual policy without a break in coverage.
- At age 62-65 to start to learn about the options with Social Security and Medicare and what is best pathway.

A quick rundown of topics one might consider follows - not meant to be comprehensive - but maybe a starting point:

Insurances
Health -
- Individual or Family Coverage - Critical ages are 26 and 65
- Primary with Medicare and Secondary with a Medicare Supplement
- Decision Making at Retirement as there may be one-time decisions such as electing a plan with prescription drug coverage or not
Life Insurance
Long Term Care Health Insurance

Legal
- Will
- Guardianship Provisions of minors and/or disabled adults
- Trust Options as appropriate to protect assets and limit probate
--Special Needs Trust if needed
--Trusts Provisions in terms of protecting assets in covering future health care costs/qualifying for Medicaid as there is strict 60-Month Look Back provision on tranfers
- Power of Attorney
- Health Care Directive (Making Decisions)

Financial & Legal
- Getting Contact Information for any advisors: Lawyer, Financial Advisor, Accountant, Workplace HR etc.
- Checking to be sure both spouses names are on all shared financial accounts (of any age)
- Checking that the beneficiary of any retirement account, pension etc is up-to-date. It is not enough to put it in a legal document if one does not follow through on the resources to have it changed - intent means nothing without execution)
- Again - a Trust of whatever kind can be set up, but one must then take direct steps to have all appropriate assets transferred to the "Named Trust "
- Be sure there is a list of all passwords/pins to all aspects of one's life which is so much online starting with their phone(s) will help in accessing information.
- Being sure both spouses names are on financial documents as mentioned, plus house deed and mortgage, plus utilities can be important in resolving issues (divorce for example) as well as sudden cognitive decline of one who has been"in charge of finances", or sudden death (at any age.)

Social Security
- Understanding what you need to have to qualify for Social Security, for Social Security Disability Insurnace (SSDI)
- Understanding how how the rule of when to collect and on whose work record might apply to a married couple to get the most benefit
- Understanding if you have a disabled child how SSDI benefits can benefit them if a parent should become disabled, retire or die of any age.
- From our case at age 18: If one meets the criteria for Disabled Adult Child, one was able to collect an amount equal to half of the parent rate of Social Security upon retirement - [/b]if you know to apply and assuming no one else such as spouse also is drawing down from the account. Upon death this can go as much as 75% for a lifetime tax free as long as disabled criteria remains.
- From our case on Medicare Health Insurance - once a Disabled Adult Child receives SSDI payments after 24 months, Medicare can become the primary Health Insurance. For most, Medicaid would be the Secondary Health Insurance (though one can elect a private Medicare Supplement, too.)

[b]Resources to find the answers:
- Using a form or book that covers these and other topics might be a good starting point for older parents - simply asking them for their benefit to fill in the information.
- A Certified Financial Planner - Can for a fee provide a consultation on your finances to give you some direction without becoming a continuing advisor or broker.
- A Family Lawyer - Can answer many basic questions which may come up in the course of life for an initial consultation which might be free or a defined amount.
- A Lawyer with Special Needs Trust experience can often be harder to find and one might start with a local organization such as The Arc or look online at a Free website: Special Needs Alliance
- An Eldercare Lawyer would be one focusing on issues related to later life decision-making and expected to have experience in protecting assets, reviewing contracts for CCRCs or Assisted Living or Memory
services.
-www.socialsecurity.gov
- Your local Senior Center of Office on Aging can be a good resource to find FREE Lectures or Workshops on Medicare, local service providers etc.

[Anonymous]

I don't think people can pass dementia screens and be completely incompetent. Download the SAGE test from the University of Ohio and give it to anyone who you think is past competence but still aces a formal Alzheimer's screening. I doubt any would pass.