Here are eight steps to taking on management of your parents’ finances.
Here are a few options that may apply to your situation:
Sometimes called durable power of attorney, this is a legal document in which one person assigns another the power to make financial decisions on their behalf, should the assignor become unable to make sound decisions. The person assigned power of attorney is called an “agent” or “attorney-in-fact.”
These are just some of signs that your parents may be beginning to lose track of their finances:
A durable financial power of attorney is recommended, since it remains in effect even if the parent is incapacitated. An aging parent can add a “payable on death” provision to bank accounts, according to Legacy Assurance. This ensures their money will bypass probate and be paid directly to beneficiaries.
These laws, called filial responsibility laws, obligate adult children to provide necessities like food, clothing, housing, and medical attention for their indigent parents.
8 Things You Must Do to Protect Your Parents’ Assets
The three most common types of powers of attorney that delegate authority to an agent to handle your financial affairs are the following: General power of attorney. Limited power of attorney. Durable power of attorney.
A legal document that allows you to appoint a person(s) to manage financial and legal decisions on your behalf, only while you have the ability to make your own decisions.
Take Steps Early You can help the person with Alzheimer’s feel independent by: Giving him or her small amounts of cash or voided checks to have on hand. Minimizing the spending limit on credit cards or having the cards cancelled. Telling the person that it is important to learn about finances, with his or her help.
11 Secrets to Helping Elderly Parents Financially
Follow these strategies for taking control of your finances right now.
His advice for dealing with a controlling aging loved one:
Here are a few ways you can help guard against financial exploitation:
Will bank accounts be frozen? You will need a tax release, death certificate, and Letters of Authority from probate court to have access to the account. A joint account with a surviving spouse will not be frozen and will remain fully and immediately available to the surviving spouse.
Keep in mind that most banks won’t allow you to withdraw money from an open account of someone who has died (unless you are the other person named on a joint account) before you have been granted probate (or have a letter of administration). If someone died without leaving a will, rules of intestacy apply.