Avoiding A Crisis of Finances As An Older Adult

When I get a new older adult client, more often than not, their finances are a mess. There are missed payments, accounts that have gone to collections, a large spend of assets, bounced checks and more. These are people who tell me (or family tell me) that they were always on top of their finances, had a good credit rating and never had credit card balances or bounced checks.

The difference between an easy resolution back to an under-control situation and a long-term financial recovery plan is how much time passes before someone else becomes aware of the problem.

A start is to identify a helper. If there is a Power of Attorney document, then have a conversation with that person about helping. They may be willing to be a second pair of eyes and just check for errors. If it is inconvenient for that person, then identify someone else who can help such as another family member or a trusted friend. If there is discomfort with revealing finances to a family member or a friend, a daily money manager is often a good alternative.

The daily money manager will be independent and will have your best interest at all times. The daily money manager can fill the role of being a second pair of eyes. If needed, they can manage all of the household finances and even coordinate with the tax and investment professionals.

Adapt Like A Paralympian

One thing I’ve learned from Paralympians is that they say “never say never.” When they lose the ability to do something one way, they will adapt and learn how to do it another way. Adding another person to consult with for financial decisions can be one way to adapt to the loss of household financial skills.

Another help is to automate regular bills and income. Likely social security, pensions, and any regular withdrawals from savings are already being auto-deposited into an account. Likewise, automate regular payments for expenses such as utilities, healthcare and insurance premiums, and credit card statements.

Ways To Check If It Is Time To Start Adapting

Finally, understand that the inability to manage household finances will eventually happen to everyone. Each person will get to that point at a different age, so it is important to do a self-evaluation to know when this is starting to happen. Some signs that one should be alert to are:

• Noticing that it is harder to get the checkbook to balance with the bank
• Receiving late notices for bills that you were sure were paid already
• Finding unopened mail where mail is kept and opened
• Having checks laying around that don’t get deposited
• Having been scammed successfully recently

This may seem a little counterintuitive, but seeing some of the above signs can be an early warning signal to have a health checkup. There are several studies showing that a person with dementia will show signs of problems with finances three to six years prior to a diagnosis of the dementia.

Loss Of A Skill Requires Grieving

These signs can have a deep emotional impact. Admitting that household finances are a problem is a major emotional step. It will likely happen before you think it has. The loss of this ability requires a grieving process. It may involve any or all of the phases of grief: denial (“I only made a few mistakes”), anger (“stupid bank!”), bargaining (“please let me keep paying the bills”), depression (“I can’t do this anymore”) to finally acceptance (“I need help, please”).

My hope is that my future potential clients will read this and reach out to someone – a trusted family member, friend, or Triad Personal Paperwork Services – at the first sign of an issue and not wait until someone else has to intervene because of a financial mess they uncover.