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Managing Your Loved One’s Finances? 5 Things to Remember

It’s a very generous act to start managing a loved one’s finances, but managing someone else’s bills and savings is also a significant responsibility. Nevertheless, the process doesn’t have to put you under extra stress. There are ways to simplify financial management so you can focus on what matters: spending more time with your loved one. 

You can use the following guide as a starting point for financial management for older adults, and by using these tips, you can keep things organized and simple for yourself. 

1. Keep Your Loved One’s Streams of Income Organized

Your retired loved one likely has more than one form of income. From Social Security to pensions and investments, there are different sources to evaluate each month. As such, you must stay organized to make timely payments and keep up with your loved one’s savings accounts. 

Folders are vital to keeping up with each stream of income. You can then choose which paychecks go toward what expenses. Some forms of payment may be best dedicated solely to savings. 

2. Help Prevent Medical Identity Theft: Be On the Lookout

Medical identity theft is a severe problem for baby boomers and other retired adults, as fraudsters always attempt to steal their insurance and Social Security information to then use to receive medical care under your loved one’s name illegitimately. 

These sorts of identity theft will leave your loved one responsible for charges they didn’t incur, which can be financially devastating. As such, you must protect them from circulating scams and phishing, but thankfully, there are plenty of steps you can take to prevent the severe problem of medical identity theft.

Protecting your loved one’s medical privacy is critical. Encourage your loved one to keep their medical and financial information private: No one should have access to their Social Security number, insurance information, or medical records besides licensed healthcare or insurance providers. 

In addition, always check every piece of mail your loved one gets. Bills and insurance statements will show any fraudulent or unexpected medical charges and give you the information you need to dispute them. If you see that your loved one’s identity has been stolen, you can report it to their insurance company or medical providers. 

3. Join Your Loved One’s Bank Accounts  

You’ll need access to your loved one’s financial accounts if you’re managing their money, and that means you’ll either need to be part of a joint bank account or have special authorizations. Some banks allow you to set up an agency account, which helps you manage certain transactions. 

In any case, remember to be honest and transparent with your loved one. They may have concerns about sharing their account information, which is understandable, but you can reassure them that you’re only trying to help them manage their money. 

4. Check on Their Long-Term Investments

Periodically check on your loved one’s investments. Whether they have a retirement account or other long-term investments, these accounts are essential for financial success. 

Keep an eye on each investment account’s performance and future projections to determine when to cash them out, as it may benefit your loved one to withdraw their investments earlier rather than later. Contact a financial advisor if you need assistance figuring out investment accounts. 

5. Don’t Forget About Less Frequent Payments  

Not all of your loved one’s expenses will recur each month. Some bills, like property taxes or insurance premiums, must only be paid quarterly or annually. 

It can be easy to forget these expenses, so we recommend setting up a notification system. The penalties for late payments on things like taxes can quickly rack up, so it could be helpful to set aside a specific day each quarter or year to review all upcoming expenses like these so that you don’t fall behind.

Financial Management for Loved Ones of Retired Adults 

Managing your loved one’s finances doesn’t have to be stressful or complicated. If you break it down and take things step by step, it will feel much more attainable, and you can rest easy knowing you’re doing your loved one an excellent service by helping them with their money.

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