As our parents age, there often comes a time when they need assistance in managing their finances.
However, they won’t always tell you when they start needing help. You need to be observant. Recognising the signs that it might be time to step in can help prevent financial turmoil and ensure their future well-being.
In this article, we will explore seven key indicators that suggest it’s time to consider actively participating in your parent or elder relative’s financial affairs.
1. Neglected financial documents
Observe whether your aging parent is neglecting important financial documents such as bank statements, insurance policies, or legal documents. Misplacing or ignoring these documents can lead to confusion and potential oversights in managing their finances. Look especially for missed payments and overdue bills.
2. Unwise spending and purchases
If you notice your ageing parent making unnecessary or impulsive buys, it might be a sign that they are struggling to comprehend the financial consequences of their actions. In particular, significant shifts in spending habits, such as extreme frugality or sudden extravagant purchases, could be indicative of emotional or cognitive changes. While generosity is commendable, be vigilant for unexplained financial gifts or loans your parent might be providing to others.
3. Increasingly falling victim to scams
Millions of people are scammed in the UK every year, with older people being particularly targeted. If you notice your parent frequently falling victim to financial scams, receiving unsolicited calls, texts or emails requesting personal information, or making unexplained transfers of money, it may be time to get involved.
4. Struggles understanding financial matters
Observe if your parents starts struggling to understand financial matters or to make decisions about their money. This could manifest as confusion about investments, mortgages, pensions, or a general lack of knowledge about managing finances. Losing track of day-to-day expenses and being unable to recall recent purchases may also suggest a decline in their brain health.
5. Difficulty adapting to technological changes
In today’s digital age, financial management often involves online platforms and technology. If your ageing parent is struggling to adapt to technological changes, it may hinder their ability to manage their online banking or monitor transactions securely.
6. Changes in their ability to care for themselves
Changes in your parent’s general health or their ability to care for themselves can significantly impact their capacity to manage their finances independently. Physical limitations, memory loss, or difficulty making decisions may signal that it’s time to step in and take control.
7. Avoidance of financial discussions
Last by not least, if your parent consistently avoids discussions about their finances or becomes defensive when the topic is raised, it may indicate that they are aware of their challenges but are hesitant to seek help.
By being aware of these signs, you can proactively address potential challenges, prevent financial disasters, and ensure your parent’s well-being. Open communication, empathy, and a strategic approach to managing their finances can minimise stress and provide a sense of security for everyone involved. Remember, taking control is not about undermining their independence but rather ensuring their financial stability and peace of mind at a time when they are becoming vulnerable.
- How do I take control of my parent’s finances?
In the UK, taking control of your parent’s finances involves obtaining legal authority through a Power of Attorney. This allows you to make financial decisions on their behalf if they become unable to do so. Learn more here.
- How do I protect my elderly parent’s bank account?
Speak to their bank for advice, and consider setting up account alerts for unusual transactions, as well as limits on daily transfers. If there are concerns about potential scams, report any suspicious activity to their bank, as they can offer guidance on protecting against scammers and fraud.
- How do I talk to my elderly parent about finances?
Conversations about money are always tricky, and can be a taboo topic for some parents. Choose your timing and words carefully, and approach the conversation with subtlety, empathy and openness. Often talking about your own finances and financial planning, or referencing the experiences of friends or family members, can make them more open to discussion.