Preventing Elder Financial Abuse

0

As your elderly loved one ages, he or she may become more at risk of being taken advantage of financially. Many elderly people tend to be more trusting of others than they should be; further, due to the intricacies of many financial instruments on the market today, the elderly are at risk of being conned by unscrupulous hucksters, especially as the early stages of dementia begins to set in and they start to lose the capacity for making detailed analyses and the corresponding decisions.

Many elderly people tend to be more trusting of others than they should be.

Here are a few things you can do to help ensure that your elderly loved one is protected from financial abuse. In taking these steps you can help simplify his or her financial arrangements and prevent a dishonest person from taking advantage of a lack of transparency in your loved one’s finances.

Make power of attorney arrangements

 When your loved one begins to near the age where he or she is at risk of losing his or her capacity to make some financial decisions it is a good idea to contact an attorney and have power of attorney documents drafted. A power of attorney document can give you the ability to make financial decisions for your loved one. You will have the ability to make decisions, liquidate or acquire assets, and manage their finances just as if they were your own.

Depending on the state where you live and the type of power of attorney form you have drafted, these powers can be vested in you immediately upon the execution of the documents or upon the incapacitation of your loved one. Further, some types of power of attorney documents give you the right to make financial decisions on behalf of your loved one while others give you the ability make healthcare and medical decisions on his or her behalf while still others give you both.

A full exploration of the various types of power of attorney arrangements and the reach of each type is beyond the scope of this article. You should consult an estate planning attorney for more information.

Make a list of important documents and their locations

 If your elderly loved one becomes incapacitated, whether suddenly or through the slow encroachment of dementia, you don’t want to have to spend valuable time hunting for important financial documents. You should sit down with your loved one and draw up a list of all the important documents pertaining to their finances as well as the locations of the documents and instructions for accessing them should the worst happen.

Take advantage of technology

 In years past an elderly person or his or her caretaker would have to concern himself or herself with routine matters such as keeping the bills paid, managing the deposit of income checks, and so on. While these are routine matters, the sheer number of transactions can add up and become overwhelming.

Consider automating these things. With the advent of automatic bill pay and direct deposit, you can assist your elderly loved one in making arrangements to have payments automatically deposited and bills automatically paid each month. This frees you and your loved one to focus on keeping track of other financial matters which may not be so routine.

Organize your loved one’s assets

 If your loved one owns stock certificates, shares of life insurance demutualizations, and other similar instruments, it can be quite a challenge to round them all up in the event of your loved one’s incapacity. It’s a good idea to organize these things now; it is often helpful to review recent tax returns, which will frequently list all of his or her assets.

Conclusion

 It is never an easy conversation to have when you have to discuss finances with an elderly loved one. He or she may feel that opening these matters to you represents a loss of independence or a lack of trust that he or she is capable of taking care of these matters. Nevertheless, by having this conversation today and preparing for the future, you can simplify managing the affairs of your loved one and help protect him or her from being taken advantage of by others.

 

 

Source

Wannemacher, Paul. How to Help an Elder Simplify Their Finances. Available at http://www.forbes.com/sites/financialfinesse/2015/06/17/how-to-help-an-elder-simplify-their-finances/. Last visited November 2, 2015.

Share.

About Author

Leave A Reply