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older couple sitting at a table with papers, a calculator and note book with a woman standing behind them. showing how to help aging parents with finances.

Discover How to Help Aging Parents with Finances

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As parents age, they begin to rely on their children for help. It can be as simple as helping with chores around the house, to more complicated tasks such as helping to manage their finances. Knowing how to help aging parents with finances can make a big difference when it comes to supporting their financial security and protecting their long-term well-being.

First, understand that financial planning for aging parents requires time and patience. It’s not a one-size fits all approach as everyone’s situation is different. Read on to discover how to help aging parents with finances including what to watch for and how to act.

Cognitive Awareness

Watching your parents grow older can bring many changes, including subtle shifts in their memory, reasoning, and overall cognitive health. With the increase of financial fraud against the elderly, detecting a cognitive decline early can prevent aging parents from potential elder abuse and falling victim to fraud scams. 

Once you notice the slightest change in their cognitive abilities, start the conversion to ensure your parents have all the necessary protections in place. 

Financial planning for aging parents includes determining if they have an estate plan in place, and if not, creating one as soon as possible. Should your parents become incapacitated, and don’t have the proper documents prepared, it could leave you in a tough situation.

These are the main estate planning documents your parents should have established:

  • Last Will and Testament
    • A legal document that directs how assets are distributed after death.
    • An executor is named to ensure the Will is carried out accordingly.
  • Power of Attorney (POA)
    • A legal document that grants another individual the authority to make financial and property decisions should the individual become incapacitated.
    • Ensure the individual is someone trustworthy and won’t take advantage of the situation.
  • Health Care Power of Attorney
    • A legal document that designates a trusted individual to make medical decisions in the event the individual cannot communicate on their own. 
  • Living Will/Health Care Directive
    • This legal document outlines an individual’s precise wishes regarding end-of-life medical treatments. 
  • Beneficiary Designations
    • A beneficiary designation is an instruction attached to bank accounts, retirement accounts, and insurance policies stating exactly who receives the asset after death.
    • When added to an account, the funds are directly passed to the individual bypassing the probate process. 

Financial Fraud

Financial fraud against the elderly is on the rise, and if not caught early, can have devastating consequences. Scammers have become more sophisticated when choosing their targets and due to cognitive and lifestyle changes, older adults are prime candidates. Knowing how to help aging parents with finances includes recognizing and taking action against red flags that may indicate they are a victim of financial fraud.

“I’ve seen firsthand how financial exploitation can affect older adults who spent decades building their savings,” Exeter’s Assistant Branch Manager, Nicole Barnett said. “Early intervention isn’t just about protecting money; it’s about protecting their independence and peace of mind.”

Red Flags You Shouldn’t Ignore
  • Unusually large recurring check withdrawals 
  • Increase in ATM withdrawals
  • Unexplained wire transfers
  • Unusual credit card charges 
  • Missed payments on loans, credit cards, utilities
  • Sudden change in account ownership
    • New POA added
    • Unknown joint account owner added
  • Missing Account Statements
    • Not receiving mailed account statements for a few months
  • Mismatched Signatures
    • Signatures on checks and documents that differ from how your parents normally sign

If you notice one or more of these red flags, contact the company or financial institution right away to freeze the account to prevent any further unauthorized transactions.

Diamond is dedicated to keeping our members and their families educated on the importance of financial safety and security. We have partnered with Sontiq, a company that delivers valuable identity theft prevention education, tips for keeping yourself protected, and swift and appropriate identity theft incident remediation.

Additional Tips for How to Help Aging Parents with Finances

Understand Their Finances

Initially you may feel uneasy handling your parent’s finances on top of your own responsibilities and obligations. Make the process easier by first understanding your parents budget, income stream, and debts. If your parents are able, include them in the conversation so they don’t feel left out. Once you understand their financial picture, you can begin putting preventative measures in place to give yourself peace of mind.

Review, Simplify, and Protect Their Accounts

As you start to review your parent’s finances, you may find they have various accounts at different financial institutions. Consider consolidating them to one financial institution to make account management and recordkeeping more efficient.

During consolidation, review their account history and look for wasteful spending, such as unnecessary subscriptions that can be cancelled. Look closely for any above mentioned red flags that may need to be addressed.

Make sure their financial institution has a Power of Attorney (POA) on file. If not, add it as soon as possible. Since the POA enables you to transact on your parents behalf without them being present, handling their finances becomes easier and more efficient.

Streamline Their Finances

Once all accounts are consolidated, set-up all direct deposits to one checking account. From there you can set up automatic payments for recurring bills to avoid missed or late payments. The less you have to do manually, the better you’ll feel.

Enable Alerts and Notifications

Create reminders and security alerts to be notified of specific account activity. Staying informed about account activity can help you detect unusual activity and avoid missed or late payments.

Reach Out for Help

If your parents’ financial situation is more complex than you anticipated or you simply need extra guidance, it’s entirely normal to seek professional assistance. Consulting with a financial advisor for aging parents will provide peace of mind that long-term care and daily living expenses are protected.

At Diamond, our certified HERO Financial Counselors and Financial Advisors are willing to sit down and help you navigate your parent’s finances. Schedule your appointment today!

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