Are you ready to step in and take control of your aging parents’ finances, and in the process, safeguard them from the lurking financial scams? On this episode of A Wiser Retirement™ Podcast, Casey Smith and Missie Beach, CFP®, CDFA® talk about taking control of finances for your aging parents. They also bring up the importance of being proactive about the potential threats your elderly loved ones may be susceptible to.
Senior citizens are often an easy target for scammers for a variety of reasons. They might be lonely because their spouse has passed away and their kids live far from home. In some cases, their minds are not as sharp as they used to be. Sometimes they are more prone to trusting in general goodwill, which is not so common anymore. Some of the most common scams that target senior citizens are, romance scams, fake government requests through letters/calls, prizes and sweepstakes, investments, and timeshare sales, among others.
Ways to Protect Aging Parents from Financial Scams:
Communication is key when it comes to helping your aging parents be aware of their financial situation and avoid falling prey to scams. So, start the conversation early. Don’t wait until your parents are in a crisis or no longer able to manage their own finances to start talking about it. Let them know sooner than later that you’re interested in helping them, and that you want to understand their wishes for the future.
Once the conversation has been started, take inventory of your parent’s finances. This includes getting a list of all their assets and liabilities, as well as their monthly income and expenses. You can also ask them to provide you with copies of important financial documents, such as bank statements, investment statements, and insurance policies.
Another step that’s very important but can be time-consuming is to simplify bills and take over financial tasks. Once you have a good understanding of your parent’s finances, you can start to simplify things by setting up automatic bill payments and consolidating accounts. You may also want to take over some of their financial tasks, such as writing checks or paying bills online. This could take some time, but once automatic payments have been set up, you and your parents won’t have to worry about the electricity being cut off because they forgot to pay the bill.
Get a Power of Attorney
In addition, consider a getting a power of attorney. A power of attorney is a legal document that can give you the authority to make financial decisions on your parent’s behalf. This can be helpful if they become incapacitated or unable to manage their finances on their own.
Make an effort to turn this conversation into something pleasant that you can do regularly. It’s important to keep your parents updated on their finances and to get their input on any major decisions. This will help to build trust and ensure that you’re all on the same page.
Finally, it’s important to remember that your parents may be resistant to giving up control of their finances. Be respectful of their feelings and be patient as you work together to make a plan.
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