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Managing Finances: What Seniors and Families Need to Know

As we age, it becomes increasingly difficult to manage our financial affairs.

For many seniors, diminished ability to deal with their money and personal business is of paramount concern. If possible, the best solution for most elderly people is to engage a trusted family member in the process of paying bills and tending to financial obligations early on. This step, along with subsequent collaborative actions, can bring much needed resolve to the stress of managing finances during senior years. If your senior loved one is coming to a stage where they need this kind of help, the following measures are worth considering:


1)    Lend a Hand

If your loved one is still relatively independent but is expressing concern about staying on top of bills, taxes and other aspects of their financial affairs, this is your cue to lend a hand. Consider scheduling a monthly sit down with your loved one just for dealing with bills, mail and any other pertinent financial matters. By partnering with your loved on this front, you gain their trust, alleviate their concerns, and give them a continued sense of control over their life. If you are not able to take on this task, consider hiring a trusted friend who is particularly patient and competent in financial matters.


2)    Consult a Financial Planner

Be very thoughtful when choosing your financial advisor; this person is an important member of your team and can play a vital role in helping manage your loved one’s affairs. Try to be involved in establishing this relationship to see that the advisor is fully apprised of all aspects of your loved one’s financial portfolio and goals. Ensure they are trustworthy and always putting your loved one’s needs and interests first. Important questions a qualified financial advisor can help with include: How and when property or assets should be sold; how much insurance coverage is necessary; what government funding is available and how it is accessed; and how long will savings last.


3)    Get a Joint bank account

Health conditions or mobility issues often make it difficult for seniors to manage their personal banking on their own. One solution is to consider setting up a joint account with a family member. Joint accounts are bank accounts in which two or more people have ownership rights over the same account. These rights allow all account holders to deposit, withdraw, or deal with the funds in the account, no matter who puts the money into the account. It may be important to consider a few issues regarding joint accounts, such as whether probate fees or taxes will apply upon the death of a joint account holder; or whether the remaining funds are intended to form part of the deceased’s estate or be gifted to the surviving joint account holder. A lawyer would prove helpful when considering these matters.


4)    Assign Power of Attorney

A Power of Attorney is a legal document that gives one person, or more than one person (referred to as your Attorney), authority to manage your money and property on your behalf. It is important to ask exactly the right person for this role. When choosing to assign Power of Attorney, your loved one must be mentally capable, meaning they are able to understand what they are choosing to do and the potential consequences of this important decision. The person acting as the Attorney does not become the owner of any of that person’s money or property, they only have the authority to manage it on their behalf. It is most important to note that even with a Power of Attorney in place, while your loved one is mentally capable, they can continue to make their own decisions about their financial affairs.


All of these suggestions have merit and can be useful measures to help reduce the stress on your aging loved one. Please remember that while helping is important, no senior should feel they are being pressured to take any of the above steps.


Would you like to learn more about Powers of Attorney? Check back on February 2, 2017 for Managing Finances: Appointing your Powers of Attorney. 


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