We focus daily on preparing younger generations to manage their financial futures.  It is a noble cause. But as educators, we can be the key to helping a parent who has never been responsible for major financial decisions navigate some of the most critical financial decisions of their lives.

A few weeks ago I had the distinct pleasure of attending my mom’s 90th birthday celebration.  As I scanned the room filled with octogenarians and nonagenarians in various states of health, I was pulled once again to refocus my financial education energies up, not down.  A common theme in my conversations that weekend (aside from affection for my dear mother), especially among the children of these folks, was concern over their ability to manage their finances.

My mother managed a household budget her entire adult life.  She operated mostly in cash, and her checkbook balanced to the penny every month.  However, she was not aware of nor responsible for the big financial decisions until about 8-10 years ago when my dad started falling for some ridiculous online email scam….a sign of his declining mental capacity.  But even for everyday spending, I notice she now reverts to price points from decades ago….perhaps a sign of her decline. I have to gently remind her that in real dollars, some of these things aren’t costing her more than they used to.  

My dad is now 97, and their need for care is approaching 24x7.  I only mention that because I can’t imagine how someone born in 1920 would have planned to live that long. Maybe he did a better job of saving because his wife was so much younger and he anticipated that his retirement savings would have to last longer to support her.  

On every family visit, as the designated “financial expert” of the family, I have to talk my mother through some financial issue.  Last fall I had to talk her through a Co-op assessment and real estate values. Around Christmas I had to convince her to authorize the caregiver to use one of her credit cards at the grocery store so that she didn’t have to go with her on every trip, or worry about running out of cash.  Now I try to talk her through covering the cost of their care and how long their funds will last, and what the options will be if they don’t. My brother lives nearby and now has access to her financial accounts, but we gently choreograph the interactions with this fiercely independent and proud woman.  My role is to inform and instruct, and his is to ensure the required action is taken.

I have this conversation regularly with my friends who are lucky enough to still have parents on this earth.  For Gen X and Boomers’ parents and older Boomers themselves, when women outlive their spouse (or become caretakers), most often the male was the key breadwinner in the family, was responsible for the bigger financial situation, including housing, cars, loans, and insurance.  If losing a spouse weren’t bad enough, the surviving (or caregiving) spouse is often in dire need of a crash course in personal finance and may end up in poverty.  Many are too proud or embarrassed to ask for our help.  To compound matters, this demographic is also the prime target of financial scammers and victims of elder financial abuse. According to a study published in the American Journal of Public Health, more than 5% of our seniors are the victim of some type of financial fraud or scam each year.  

If you find yourself in the position to support a parent, you aren’t alone.  According to AARP:

Roughly 18.5 million family caregivers provide unpaid financial management assistance to a person 50 or older in this country.

These caregivers can handle every day things, but most are not equipped to handle anything complex, and AARP is trying to help. AARP started a Bank-Safe initiative which has several useful suggestions.  The CFPB has topic specific resources (link below). As educators, we can champion financial literacy initiatives for seniors for our parents and in our community.

Here are a few no-brainer suggestions (mine and theirs) to get you started:

• Make sure your parents only keep a small amount of cash in an account accessible with a debit card or checks they use everyday. (My mother “lost” her wallet on the subway and someone emptied her bank account….luckily, my brother helped her complete all the steps required to get the money back.)
• Set up alerts on their bank accounts.  Have the alerts go to you. (You may need to make the account a joint account in order to do this.)
• Help them to automate payment of regular monthly bills.
• Make sure you get a complete list of accounts and insurance policies sooner rather than later.  (Luckily, my dad compiled this list while he was still on top of things.)
• Check to see if they have online Social Security accounts set up and check the information.  If not, set one up. This is an avenue for fraud.

How many of our students have grandparents who rely on them for tech support?  If we teach these kids well, maybe they can help their grandparents with their finances while they teach them how to find their photos on their iPhones!

Other helpful resources and articles

• In addition to the AARP, the Consumer Financial Protection Bureau would be a good first stop.  They offer a free ebook and articles for the consumers and the caregivers.
• Money Magazine this month has an article on the best banks for seniors.
• Home Instead, Inc. has helpful questions to get the conversation going (and statistics indicating a dire lack of planning) to establish plans for care later in life.
• Here is an article that helps in finding a financially sound retirement community.
• This article explains how caregivers might be able to get paid to care for their disabled family members.
• This article on elder abuse and fraud gives some frightening statistics and explains why financial institutions should be involved in prevention.
• What happens when a parent remarries? Here is a pretty comprehensive story with the pluses and minuses, and steps to take to protect each generation potentially impacted by the marriage.

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