By: Paul Lorah
Do you have aging parents? if so, do you ever stop to think--What would happen if I had to suddenly take over management of my parent's finances?
In the unfortunate event of a parent becoming ill or incapacitated, someone would have to take over paying bills and managing their money. It happens to many families every day, if it happened to your family today, would you be prepared?
It's better to have all the information you need before your parents can no longer take care of their finances. Ok, but what information do I need and what should I ask them?
- Have they named a durable power of attorney to manage their finances?
The first step is to find out if they have named a Durable Power of Attorney (POA). Without a POA in place, you may have to go to court to get guardianship of your parent in order to access accounts on their behalf.
- Where do they keep their financial records?
Whether they keep their money and documents in a bank, a safe, or under the mattress, you need to know where to find records when you need them. What is the location of keys or codes to lock boxes or safes? for more information read our article "What Do I Do With My Original Power of Attorney Document"
- What are their bank account numbers and names of their financial institutions?
In addition to knowing where they keep their money, you need specifics on all account numbers. What banks do they use? Who is their mortgage company? Do they have an investment firm?
- What are their monthly expenses?
Gather information on their mortgage, car payment, credit card debt, utility bills and other expenses. You'll need to know who to pay so bills are not late.
- How do they pay their bills currently?
Are there auto debits being taken out of a checking account, do they use online banking or only paper checks?
- How much is their annual income and where does it come from?
Does your parent receive a monthly pension check, dividends from investments, disability or alimony?
- Do they receive Medicare, Medicaid, or Social Security?
If your parent becomes incapacitated, you may have to investigate the status and eligibility of government assistance.
- What kind of medical health insurance do they have in addition to Medicare?
Do they have health insurance provided by an employer? If they are retired, are health benefits included as part of a pension?
- Do they have long-term care insurance?
Standard health insurance plans do not cover the cost of assisted living or a nursing home. Did they purchase a long-term care insurance policy to cover the cost of those residences? If not, and they can no longer live on their own, what can they afford in terms of long term care?
- Do they have an accountant, financial planner or attorney?
Who is it and how do you contact them? Have they done any estate planning?
- Do they have life insurance? Life insurance premiums may still need to be paid and you wouldn't want a policy to lapse.
If you have aging parents plan now while everyone is healthy.
Didn't plan ahead and need help now? You still have options. Contact us today!
Author Paul Lorah is a Medicaid and Long Term Care Planning expert who has authored such books as "Planning and Paying for Long Term Care' and "How to Get Medicaid to Pay for Your Long Term Care Costs".