Does this sound familiar? Things that used to be easy for your parent(s) — making health care decisions, running errands, taking care of the house, handling finances — have become challenging.
Of course, lending a hand around the house is one thing. Taking over your parent’s finances is another matter entirely, with a set of emotional anxieties. Whether you face this dilemma now or can see it coming, these tips can help you prepare:
- Know when it’s time. The process happens so slowly that it may be easy to miss the signs that your parent needs help with money. In fact, telltale signs may not have anything to do with money at all. Problems with memory, difficulty keeping the house clean, or subtle personality changes could all be signals their finances are beyond their control.
- Keep family members informed. Once you realize your parent needs help, get your siblings involved. Keeping siblings in the loop ensures openness, minimizes misunderstandings, and helps prevent family squabbles.
- Start the conversation. Parents who begin to need help also want to feel in control. That’s why it’s important to approach the subject of parental finances with care. Ask if there are ways you can help, like balancing their checkbook. This keeps the parent in the driver’s seat while giving you an understanding of their financial situation.
- Look into legal documents. If your parent hasn’t done so already, encourage him or her to set up a durable power of attorney. This authorizes another individual to make health care, business, and financial decisions on your parent’s behalf. An updated will can also dramatically simplify financial matters when he or she passes away.
And this is probably my best tip: If you know your parent needs assistance with finances but are unsure how to get started, a financial professional can be a big help. Look for one who has experience with financial planning for seniors, including estate planning. They apply their expertise and can bear some of the load during an emotional time.
Principal Funds, Inc. is distributed by Principal Funds Distributor, Inc.