SILVERcare

How to help reluctant parents with their financial issues

So, suddenly, you find yourself a member of the “Sandwich Generation”!
It’s that inevitable period in life when a person is faced with the crushing responsibility and their own family, spouse, kids with expensive needs and college educations; and at the same time, elderly parents who have suddenly lost their independence and need help with life’s day to day challenges.

For some it comes gradually, with a parent slowly becoming more frail or having the beginnings of dementia set in. For others, it is the onslaught of a catastrophic event, such as a stroke, or sudden illness. Regardless of the cause, it can be a traumatic time for all concerned. And, to compound the matter, the parent often thinks they still do not need any help. Convincing them that they need help with their financial issues is a sensitive task and requires caution.

How you approach them with the idea and transition into assistance can make a huge difference in their receptiveness. Try to begin the process while they are still cognitive, still able to communicate and before substantial disability sets in. Some ideas:

Start with a non-invasive approach to help with things like insurance claims, handling banking matters or arranging for household repairs or maintenance. These tasks are often confusing and befuddling to an older adult and they may actually welcome the idea.
With finances, be very careful not to appear to take over their assets or remove their involvement over their finances. Most seniors are highly possessive over the security of their financial well-being, and will resist all efforts of invasion into their control. Such a process must be done slowly and often, the children must “regain” the confidence of Mom or Dad to allow them to begin to handle their financial affairs. Suggest that they merely place you as joint account holder on some of their accounts or that they give you permission to talk with their banker to see how they can become involved with the parent’s finances. While Mom or Dad may remain in control of their assets, the children at least begin to acquire a working knowledge of their finances and routines, and set the stage for their involvement, when that time does arrive.

Two documents you should consider to assist in the process of handling a parent’s affairs are a health-care proxy and a durable power of attorney. The health-care proxy allows the appointed individual to assist with health care decisions if the parent is incapacitated. Of course, a living will is also preferable, where the specific desires of the parent regarding life support and extensive resuscitation measures are addressed. Irregardless, a health-care proxy can assist with other necessary decisions and issues, beyond the living will.

The durable power of attorney allows the appointee (child) to handle and transact the financial and administrative affairs of the incapacitated parent. Be sure to consult an attorney familiar with your state’s requirements of such documents. The durable power of attorney can be structured to only take effect upon certain defined events, thus giving the parent the comfort that they are still in control until that time arrives. Such documents must be executed while the parent is of sound mind to do so.

With a gradual, non invasive approach, it is easier to get the cooperation of the parent and you’re not a threat to their control. With time, they will gain confidence that your help is not a threat to their security and they may begin to relinquish some of their control.