Adult children of aging Americans are finding themselves caught in a delicate situation of whether they should look into the finances and investments of their parents, according to U.S. News & World Report in “How to Help Aging Parents Manage Portfolios.”
It’s not easy to talk with parents about their finances and their vulnerability to scam artists. Today’s thieves are also savvy. They use Facebook and other forms of social media to learn about family members travelling outside of the country, then call the elderly parents and pose as the grandchild needing money immediately for an emergency.
Older adults, who are lower in numerical skills, tend to rely on their emotional response in making financial decisions. Loneliness and depression, common in aging seniors, also increase the risk of becoming a victim of a scammer. That’s especially so, in the case of someone who has recently become a widow or widower.
It’s often hard for the senior to discuss finances with their children, unless they have done so over the course of their children’s lives and are comfortable doing so.
The biggest marker for many elderly people, is the loss of their ability to drive. That’s followed by the inability to handle one’s own finances.
However, this problem is only growing as investors live longer and portfolios continue to grow over the course of their lifetimes. It only takes a few mistakes for an impact to hit the portfolios and often there’s no recourse.
The first step for adult children is to be aware of any signs of mental decline. Just be careful not to jump every time someone can’t find the right word or remember someone’s name. Keep an eye on their behavior: a formerly neat person who is now leaving bank statements lying around open on their desk, past-due notices arriving or an extreme amount of mail from questionable charities (versus large nationally-known organizations). This mean it is likely they are having a problem handling day-to-day finances.
Don’t confront the issue in a challenging manner. Have a pleasant conversation, possibly starting with a talk about your own finances and how you speak with your own children, or plan to, to get them moving into the topic. Once they are comfortable talking about money, start discussing other important issues, like whether they have a will, medical directive or power of attorney.
An estate planning attorney can advise the family in how to deal with this delicate situation.
Reference: U.S. News & World Report (Oct. 22, 2018) “How to Help Aging Parents Manage Portfolios”