Four things to know now about your parent(s) finances
Many families that haven’t seen each other all year come together for the holidays. That makes the holidays a prime time to make sure Mom or Dad is doing okay on his or her own.
One of the first signs that your parent(s) may need help is when his or her finances become sloppy or confusing. Before the time ever comes when you have to take over your parent’s finances, make sure you know these four things:
- Has your parents had a durable power of attorney drawn up? If so, who is the responsible party and how do you contact him or her? That’s who will be handling your parent’s finances if he or she is unable to do it him- or herself. If not, you’ll have to get guardianship of your parent, which requires going to court, in order to access financial accounts. If your parent hasn’t had a durable power of attorney drawn up, urge him or her to do so.
- Where does your parent keep the financial records, such as bank, investment fund, or other financial account numbers, and where does he or she keep mortgage books or bills to be paid? In a drawer, a safe, a coffee can behind the stove, you need to know where to go for financial information should your parent become incapacitated.
- How do bills get paid? Does he or she have an accountant (in which case you’ll need that name and contact information also), are bank accounts automatically debited, does he or she pay bills online or rely on paper statements? You’ll need to know how things were done in the past to keep up should you suddenly have to pick up where your parent left off.
- Where does his or her income (including money to cover health care) come from? Don’t forget Medicare, Medicaid, and Social Security; pensions; dividends; health, life, or long term care insurance.
We’re all getting older, and the time may well come when you have to step in for a parent. Make sure you’re prepared to do it smoothly, should it become necessary. A little preparation now will save a thousand headaches and nightmares later on.
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