Adult children worry about their parent’s finances, but whether they are worried for the right reasons is sometimes hard to determine. Are they concerned about a spendthrift parent becoming their responsibility, or that a scam artist will defraud an elderly parent? Seniors who are eager for companionship are perceived as vulnerable. Families worry about the triple whammy of a volatile stock market, large withdrawals and newly-arrived romantic interests whose intentions may or may not be sincere. But experts report that many of the worst financial abusers are the adult children or relatives themselves. Are they protecting their elderly parent, or their inheritance?
There are no truly neutral parties when elderly parents and their finances are concerned, as reported in The Chicago Tribune’s “Strategies for managing your elderly parent's finances.”
One should document examples of financial mismanagement; however, this can cause a fight in court to take control of parents' assets. And if the children lose, the parents may be angry enough to completely cut off the children.
There can also be trouble when parents decide to leave assets to children according to their perceived needs instead of an equal split. The children’s situations can change and giving different amounts may result in permanent damage to sibling relationships long after the parents have passed away. However, an equal split of the estate places the onus on the children to be good stewards of the money. In other words, simpler is sometimes better.
Communicate your intentions so that your children are prepared for the day when the assets are disbursed. They’ll have some idea about what is coming to them.
It’s always a good idea to speak with an experienced estate planning attorney. He or she can give you ideas and strategies to make your money go farther when your children inherit and find solutions for children who might not spend the money wisely.
Reference: Chicago Tribune (September 4, 2015) “Strategies for managing your elderly parent's finances”