How to Protect Your Elderly Parents’ Assets: 5 Key Steps

Before you take any actions, it’s important to learn what assets your parents have and what they’d hoped to do with them. Experts recommend having financial conversations early, while your parents still control their finances. It can also be helpful to talk about these topics over time rather than trying to fit everything into one discussion. Some questions that may be helpful to explore include:

• What were your financial goals when you started accumulating assets?
• What values guided your choices?
• How do you see your assets being used after you’re gone?

Keep the conversation simple and focused on what your loved ones want. Because emotions can easily spike when discussing something as sensitive as finances, give yourselves time to process concerns and suggestions.

One way to stay on top of what’s happening with your loved one’s assets is to have view-only access to their bills and bank accounts. That way you can spot any issues that arise, such as unexplained charges, withdrawals, or other activities.

You may also decide to become what’s known as a trusted contact for your loved ones’ banking accounts.^[01] As a trusted contact, you’ll be able to speak with their bankers if they’re unable to reach your loved ones or if they have concerns about fraud. Trusted contacts are only able to communicate about an account holder. They aren’t empowered to act on the account holder’s behalf.

It may also make sense to open a joint banking account with your loved ones, although there are important pros and cons to consider for you and for them.

Let our care assessment guide you

As your parents’ agent appointed under a durable POA, you’ll be able to act on their behalf in financial and legal matters if they’re incapacitated. A POA document can be shared with any company, organization, or facility your parents use, so you can communicate with them on your parents’ behalf. Some organizations, like banks and other financial institutions, have their own POA form that they prefer their customers to use.

Read more:The Top Misconceptions About a Power of Attorney

From tax shelters to irrevocable trusts, there are many ways to protect your parents’ assets once you understand how they’d hoped to use them. Financial and legal professionals can advise you and your parents on specific strategies for preserving and protecting their wealth.

Financial advisors

A certified financial planner can teach you various ways to simplify your parents’ portfolio and how to set aside money for their long-term care needs. While there are different types of financial advisors, experts recommend hiring what’s known as a fiduciary. A fiduciary is an advisor who is required to act in their clients’ best interest. Fiduciaries charge a fee for their advice rather than rely on commissions they earn by selling financial products.

A financial planner can advise you and your parents on:

• Life insurance
• Long-term care insurance
• Medicaid-compliant annuities
• Tax issues, including tax implications of your loved ones living with you

Elder law attorneys

Certified elder law attorneys can review your loved one’s financial, legal, and medical documents to ensure they’re up-to-date and reflect their current wishes. They can also can advise you and your parents on:

• Creating a last will and testament
• Qualifying for Medicaid
• Establishing a Medicaid asset protection trust
• Revocable living trusts

If memory issues are a concern, it’s even more important to meet with professionals while loved ones are still legally competent. Planning in advance helps ensure you’re all prepared in case of a dementia diagnosis or other health decline.

Read more:What to Do After a Dementia Diagnosis: 10 Steps to Help You Move Forward

Talk with a Senior Living Advisor

As your parents age, they are likely to become more susceptible to fraud and scams. According to the U.S. Department of Justice, financial fraud, abuse, and exploitation rob seniors of millions of dollars every year.^[02] These crimes, which include scams that target seniors, can wipe out their assets, leaving them with little to no money.

You can quickly make your parents less vulnerable to people who would defraud or abuse them by taking these simple steps.^[03] Talk with your parents first to make sure they’re comfortable with you:

1. Adding their home and mobile phone numbers to call blocking tools, such as the National Do Not Call Registry and others provided by wireless carriers and technology companies. This helps prevent elder abuse before their phone ever rings.
2. Helping them gather legal documents and signing them up for free credit reports through one of the three nationwide consumer credit reporting companies: Equifax, Experian, and TransUnion. Federal law requires those companies to give consumers a free credit report every 12 months if they ask for it. This makes it easier to keep an eye out for any unusual activity or potential fraud.
3. Setting up utility bills, rent or mortgage payments, and credit card payments to be automatically withdrawn from to prevent late or missed payments.