In the past few months, we’ve seen a few clients, and parents of clients, mentally decline in a short amount of time. They had a handle on their financial things, but then pretty rapidly, things started to slip. In this post, I’m going to give you a few questions to think about asking your elderly parents. Or, if you’re in your seventies and eighties, they could be good questions to answer for your heirs.
#1: Do You Keep a List of All Your Accounts on File?
Ask them where that list is. If they don’t have a list drawn up, then it’s a good idea to compile one. Make sure that the people who are listed as designated beneficiaries are also included on that list. For example, if there’s any individual retirement accounts and other assets that may go to the children, save this information in a secure spot. And if they have a financial advisor, be sure contact information for the advisor is on the list as well.
Some clients give their most financially-minded kids an updated list once per year. And sometimes we even include the adult children in meetings with our elderly clients, so that they are in the loop of everything that’s going on. That’s important because it helps them understand that their parents have a plan, as well as if their parent becomes ill and can’t make decisions on their own behalf, they know what to do next.
#2: Do You Have a Plan? Is it Enough?
Find out whether your parents have a financial plan and a financial advisor. If you have a financial plan of your own, telling them about your plan is an excellent approach to finding out what they’ve got in place for themselves. Some parents will have a well thought out financial strategy that’s going to allow them to live comfortably into their late nineties or longer. Or, you may discover that they’re living on a strict budget and money’s scarce for them. If it’s apparent that you’re going to need to assist in their financial future, then start planning now, because this could have a really big impact on your own plan.
#3: Where is Your Will? Who is the Executor?
It’s important to understand whether you have a part in the estate plan and what your responsibility entails. Many of our clients name their children as executors of their estates or trustees of their trusts and wills. So, find out where your parents store their wills and estate paperwork, and which attorney has the most recent copy. Although most estate planning attorneys maintain an original copy on file, we encountered a few cases where no one could actually find the most recent update after a parent passed away.
If your parents are among those who do not have a will, encourage them to engage in this with an estate planning attorney and then assist in putting one in place. You may even offer to pay for it to be done. Unwinding in a state without paperwork is a lot more expensive and time-consuming than what it might cost for an attorney to draft up a will or trust.
#4: Do You Have Life Insurance?
Since these statements sometimes come less frequently than other brokerage or IRA statements, they’re often forgotten about, or they’re not included in the most recent updates, especially if it’s a small amount.
#5: Are There Any Special Bequests to Family or Friends?
They might have a special keepsake or heirloom that they want to pass along to someone specific. And if there’s a treasured item, having it clear ahead of time where it should go is an easy way to have less disagreements after they pass away.
#6: Who is Your Financial Power of Attorney?
Those are the legal documents that name a primary and secondary person to make financial decisions on their behalf if they become incapacitated.
#7: Who is Your Medical Power of Attorney?
Just like the Financial POA, this form makes sure that their wishes are clear on what they’d like to do if they become terminally ill or incapacitated, and who’s going to be helping make those decisions.
#8: Do You Have a Long-Term Care Plan?
Long-term care can be pretty expensive and it might be uncomfortable to bring this up, but it will give you both peace of mind knowing exactly what to expect out of all these possible situations that could happen.
#9: Are You on Top of All Your Bills?
This question could be a sensitive one, because no one wants to admit that they’re making mistakes, but if they’re not on top of their bills and their banking, checking, and all of that, it can be an early sign of mental decline.
Some other things to ask are: have you missed any bills or had any issues with the bank balance lately? Sometimes it’s a slow decline and missing bills or not balancing the check book could be a sign.
I know you love your parents and want what’s best for them. Because of this, it could be good idea to pick a few questions and start having these conversations the next time you talk.