June is National Elder Abuse Awareness month and a great time to talk with older family members about their finances. According to Forbes, elder financial abuse can take many forms, such as fake charity solicitations, telemarketing scams, and identity theft. However, statistics from the National Adult Protective Services Association show that 90% of abusers are a family member or trusted friend. Keeping an open dialog and creating a strong support system are crucial to avoiding scams. Although talking about money can be an uncomfortable subject, the best time to discuss finances is before there is any hint of a health crisis or concern about money management.
Following are three actions you can take now to help protect aging family members from elder financial abuse.
DISCUSS A POWER OF ATTORNEY
Power of attorney is a legal document that lets you appoint a person to manage your affairs if you are unable to do so yourself. If your aging family member fears they will reach a point where they can no longer handle their finances, someone will need to do it for them – power of attorney is a way to legalize this transfer of power. Whoever signs the power of attorney document should be trustworthy and responsible. Not only are they in charge of their own finances, they will oversee someone else’s finances as well.
COMMUNICATE WITH YOUR FAMILY
To ensure your elder family members’ assets are managed properly, talk to them about it sooner rather than later. Clarify what they want done with their money once they can no longer manage it themselves. Ask which other relevant family members they would like included in the conversation, and create a plan together. Keep everyone informed as time passes to avoid disputes later on.
WATCH FOR SCAMS
Even if your aging family members are in good health, they are still at risk for scams. The elderly are popular targets for criminals who often take advantage of vulnerable or overly trusting people. It’s important for someone to help them keep track of how they spend their money. Advise them to not give out money or personal information to strangers who may call, write, or email asking for help or demanding the repayment of a fictious debt. Create a system where any new invoice, debt, or monetary gift is discussed before it is paid.
The unfortunate reality is that some people become more vulnerable as they age. However, by becoming more educated on elder financial abuse and learning about the warning signs, you can be proactive in ensuring your aging family member’s finances don’t fall into the wrong hands. Visit slfcu.org/Balance for more financial education resources.
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