Eventually there comes a time when an adult child has to take over his or her parents’ finances. This can be an emotionally trying time for everyone involved and it’s usually accompanied by various levels of stress. Not only is the parent no longer capable of handling their finances, but a variety of questions arise including their ability to afford nursing homes in Wilmington NC, whether or not insurance will cover any associated medical bills, as well as other financial questions.
Here, we provide some helpful steps to assist and guide you through this difficult time.
Step 1: Gather Your Parents’ Financial Documents
Collecting all of your parents’ financial documents is an important first step, and unfortunately, it is not always an easy one. Gather up all of their bills, bank statements, and tax documents. Check Schedule B on their IRS tax returns to see if any dividends or interest is listed. If so, look for the financial institutions that are associated with them. If your parents used an accountant or had a lawyer, then contact that person to see if they can help you in your search.
Once you have all of the financial documents gathered, make a list of assets and expenses so you know what needs to be paid and how much money you have to work with.
Step 2: Locate Power of Attorney Documents
If your parents have a power of attorney document naming you as their power of attorney, then you will need this document before you can access their bank account (unless your name is already on the account). In either case, you will need to present this document to every financial institution your parents were involved with before you will be granted access to their financial information.
Step 3: Pay any Overdue Bills
If your parents had overdue bills, try to get them caught up as quickly as possible. Then again, if they have a lot of expenses and only a small amount of cash reserves, then you may want to contact an attorney who specializes in elder care situations for assistance. The attorney can help you determine which bills need to be paid and which ones can wait.
Step 4: Document Every Financial Transaction
Family members can often make life challenging on the one named power of attorney. Therefore, it is important to accurately document every financial transaction you make concerning your parents’ finances. Keep copies of any checks paid out and records for any cash transactions. This is sometimes necessary to help prove to siblings that you are handling your parents’ financial matters responsibly.
Step 5: Consider Hiring Outside Help
Managing an aging parent’s finances is not an easy task, especially when that parent may yet still have many years ahead of them. To help make this job easier and less likely for error, you might want to consider hiring an outside financial planning team. These professionals can help guide you and create a workable budget for your parents so the stress is not all on you.
When an aging parent needs to be placed into a nursing home in Wilmington NC, like the Davis Community, the adult child needs to address certain additional questions that can have an impact on their finances, including:
- Does the parent receive Medicare, Medicaid, or Social Security?
- Does the parent have any secondary or long-term care insurance plans?
- Where does their income come from (retirement plan, pension, etc.)?
- How does the parent usually pay their bills (through the mail, online, at the bank, etc.)?
- Does the parent have any automatic deductions being taken out of their accounts or paychecks?
- Is the parent eligible for any government assistance programs?
- Does the parent have a living trust or any bank safe-deposit boxes?
As difficult a subject as it is to approach, it is important to discuss financial matters with your parents before they become incapacitated. Preparing for this eventuality will help make the entire process easier to manage for everyone involved.
For more information about the Davis Community nursing homes in Wilmington NC, please give us a call at 910-686-7195 today.