It may be awkward, but talk to your retired parents about their finances

By:  Susan M. Graham, Certified Elder Law Attorney, Senior Edge Legal, Boise, Idaho

Why?  Your family may have never talked about money.  It may be your parents are private about their finances.  The problem arises when they become unable to communicate due to illness or death.  No one know about their bank accounts, investments, bills, or where to find the information.[1]

How can you start?

First, make a list of the information you are seeking:

Do they have a place where their papers are located in the home, or a safe deposit box or safe?  If the papers are in a bank safe deposit box, who can get into the box and where is the key?  If they use a safe, who has the combination?

What planning papers do they have, and who is nominated to act on their behalf?  These papers may include a Last Will and Testament, Revocable or Irrevocable Trusts, financial power of attorney, health power of attorney and living will.

Have they notified the persons who are to act as their power of attorney, personal representative, executor, administrator or trustee, that the nominated person needs to act on your parents’ behalf?  Do the nominated people have copies of the papers appointing them or do they know how to obtain those papers?

Where do your parents keep their monthly or quarterly financial statements? Can anyone else access the accounts during your parents’ lifetimes?  How can those accounts be accessed after death?

Are your parents’ accounts coordinated with their estate plan?  For example, is the life insurance death beneficiary the former spouse of a parent?  What a mess that would be.

It may be awkward to start the conversation so, rather than sound as if you are trying to take over, you may want to start off with “I want to be able to help you if you are too ill to manage.  In addition, I want to do what you want when you die.  I need some information to be helpful.”

One other approach is to include your parents’ professionals in the conversation.  A joint appointment with their attorney, certified public accountant or financial person is an easy way to stay focused on the issues, rather than get distracted with family personalities.

If you don’t take these steps, imagine the mess trying to straighten out your parents’ finances with no information.  It’s like playing the game “Pin the tail on the donkey”– after being blindfolded and twirled around, you are sent off to find the donkey.  Good luck!