As the average age in Canada continues to climb it is inevitable that more children will be called upon to help their parents when they can no longer do so for themselves.
Although it can be a difficult conversation to have, the subject of who will manage your ageing parents’ finances if they become unable, is one that must be broached in the spirit of proper planning for you and your ageing parent.
The truth is that most people have no idea what they would do if they were suddenly forced to take over their parents’ finances. Although many have some basic knowledge of financial management, few would consider themselves experts. Especially when it comes to managing someone else’s money.
The best time to start planning is as early as you possibly can, not when a parent becomes incapacitated and you’re suddenly stuck with questions about bills and caregiving you simply can’t answer.
Here are a few tips to get you started down the road to firm financial planning for a parent.
Find out where and how you can access their financial information.
Which banks and financial institutions do they use? What are the account numbers? Which insurance company do they use? What about their mortgage?
Financial records are equally important.
Do they have them stashed in a drawer somewhere or a file cabinet? Saved to the hard drive or stored in a safe? if so, so make sure to keep a list of how and where you can access their financial information quickly and easily. Don’t forget, you’ll need passwords, keys and combinations.
Revenue and expenses
Your parent could well be facing a new reality when it comes to income and expenses, especially if they’re facing unexpected medical issues. It’s important to know where you’re starting from.
Is there currently lifestyle sustainable and how are they paying for it?
Create a list of assets and debts
Go through your parents’ potential assets and debts. It’s inevitably going to be an awkward conversation but it’s vital. Find out how much they owe and to whom. It’s just as important to try and compile a list of potential assets and their value.
Is there a will?
If they have a will in place find out when the will was created and where the original document is located. If its been more than a few years suggest they look at it again to ensure their wishes are still accurately represented.
Who’s working with them?
Do they have a financial planner or an attorney? Get the names and numbers.
Don’t be afraid to call in the experts
If you’re feeling overwhelmed or just need a gentle push in the right direction don’t hesitate to reach out to a financial planner or an elderly care attorney for assistance.