Talk to your parents about their finances
The financial well-being and long-term care needs of aging parents can be among the most sensitive, difficult issues for families to discuss.
While it may be an uncomfortable topic, it’s important that adult children have these discussions with their aging parents ahead of time to prevent potential problems and misunderstandings down the road.We encourage Minnesotans to take the time to talk with their loved ones about their financial commitments and long-term care wishes.
Get the conversation started with these four questions:
- Do you and your parents know the red flags of a scam?
According to the Investor Protection Trust, one out of every five persons over the age of 65 has been victimized by a financial swindle. One recent study estimated that older Americans are defrauded out of nearly three billion dollars each year.
Be sure that your parents know how they can protect themselves from fraud. For example, they should avoid giving out personal information to strangers in response to texts, emails or calls, regardless of who they claim to be or where they claim to be calling from. Be alert for behaviors that may indicate your parent is a victim of financial exploitation, such as unpaid bills, an unexplained lack of money or the sudden appearance of a new “friend.”
- What is the plan in case of cognitive issues or other health problems where your parents may not be able to take care of their own finances?
Encourage your parent to officially ask someone to serve as their medical and financial proxy or power of attorney. It is best if your parent chooses someone who they trust to make their financial decisions. If possible, there should agreement within the family about who is being entrusted with these responsibilities. This person should also maintain clear communication with all family members.
- Where do your parents keep their accounts, records, insurance policies, and other important financial documents in case they are needed?
If an elderly parent’s health suddenly deteriorates, out-of-pocket expenses can add up quickly. Discuss all sources of income and insurance coverage to determine how and if your parent might cover unanticipated medical treatment. If your parents agree, familiarize yourself with their insurance coverage and financial assets such as savings, pension plans, stocks, IRAs and 401K plans. Income, assets and insurance affect Medicaid eligibility and Medicare options.
- What are your parents’ wishes for their assets, estate, and future quality of life?
Ask your parents whether they have created a will and where it is located. Know your parents’ views on end-of-life care as well, and make sure their preferences are recorded in an official document such as a living will or advanced health care directive long before they no longer are capable of expressing informed consent.
Is your parent comfortable with the prospect of living in a nursing home, or does he or she have plans to move in with a family member or friend should special care be required? Be open and direct about your ability to honor these wishes. If your parents need nursing home care, it’s important to know if their monthly income meets state eligibility requirements for Medicaid.
For more resources, Minnesotans can contact the Senior LinkAge Line, a free service offered by the state that guides older adults and their families to community resources. The North American Securities Administrators Association’s Serve Our Seniors webpage offers also offers information for caregivers.
Hang Up on Fraud
Telephone scams are an increasingly prevalent form of fraud. The ordinary telephone is today's weapon of choice for criminals. One of the most common complaints reported by seniors and their loved ones is how often they encounters scams and fraudulent schemes over the phone. Common examples of fraud:
- I’m calling from Microsoft and it appears you have a virus…”
- “You’ve won a foreign lottery and you just need to send money to claim your winnings…”
- “This investment is low risk and high return.”
- “This offer is good for today only.”
- “This is your grandson and I’m in jail and need bail money.”
- “You owe money and face serious consequences.”
Scammers use public information to find out your name and phone number. They often use scare tactics to get you to send money, provide personal information, or gain access to your computer. If someone calls and wants you to hand over money, be very suspicious. Remember, if it sounds too good to be true, it probably is.
Hang up on fraud:
- End the call: Don't be a "courtesy victim." When it comes to protecting yourself, there is no such thing as being rude. Just end the conversation and hang up the phone.
- Phone a friend: If you are confused or concerned by a phone call, contact a trusted friend or family member for advice. Don't let a caller rush you into making a decision.
- Report the fraud: We can't stop fraud that we don't know about. Call us and report the fraud so that other don't become victims. You can contact the Consumer Services Center at 651-539-1600 or 1-800-657-3602 (Greater Minnesota only) or by email at consumer.protection.@state.mn.us.