Alzheimer's disease produces several early signs, most of which are physical. One early sign of dementia is memory loss, such as forgetting to deposit a Social Security check or paying a bill with no money in a bank account. According to a survey conducted by AIG, more than 50 percent of all seniors older than 65 manage their finances by themselves. The combination of managing finances and early-stage dementia can cause plenty of issues for elderly people.
Elderly people also are vulnerable to scams and fraudulent activity. To prevent your parents from succumbing to fraud, as well as ensure they enjoy healthy finances for the rest of their lives, you can take several steps to protect elderly parents' assets.
What Are the Early Signs of Financial Struggles?
If your parents suffer from a mild cognitive decline, they might be able to complete simple financial tasks such as pay for regular expenses. However, complex financial tasks like balancing a checkbook can lead to serious errors.
Before you implement the steps for protecting your parents financially, look for one or more of the following signs:
- Forget to pay bills
- Disconnected utility service
- Unable to organize personal financial records
- Money inexplicably missing from a bank account
- Strange purchases
Tips for Protecting Your Elderly Parents' Assets
Being hands-on is the principle to follow for protecting your elderly parents' assets.
Register for Free Credit Reports
Every American is entitled to one free credit report each year from Equifax, Experian, and TransUnion. Sign your parents up for free credit reports to keep them informed about their credit scores.
Establish a System of Automatic Payments
Digital technology has made it easy to set up automatic payments. Your parents can set up automatic payments for a mortgage, an auto loan, utility bills, and credit cards.
Streamline Their Financial Portfolio
This is a step that might require the professional expertise of a certified financial planner. As we approach retirement, most of our investments should be generating income. Simplifying your parents' financial portfolio makes it easier to manage personal finances and sets aside money for long-term care expenses.
Establish a Power of Attorney
A power of attorney acts on your parents' behalf to address the legal and financial decisions that your parents can no longer make. This step also helps prevent a court from taking control away from your parents when managing assets.
Understand Their Estate Plan
Knowing how your parents plan to handle their estate can pay off in the future. You will be able to discover if any assets are missing and find out if there are any changes made to the estate plan.
Create a Living Trust
Before your parents reach retirement age, encourage them to establish a living trust. As the grantor, your parents designate a trustee to follow their wishes for managing the trust. An irrevocable trust provides your parents with many advantages, including ensuring they cannot change the terms and conditions of the trust. This is especially important if both of your parents start displaying the signs of dementia.
An irrevocable trust protects your parents' assets against creditors and legal judgments. It also reduces the tax obligation of the estate. Setting up an irrevocable trust is relatively easy to do. If you work with an experienced estate planning attorney, you get the expertise you need to protect your elderly parents' assets for the rest of their lives.
Schedule a Free Consultation
An irrevocable trust written by one of our estate planning lawyers will ensure your parents never fall victim to scams and other types of fraudulent activities. We will walk you through the process of establishing an irrevocable trust, which will protect your elderly parents' assets for years to come.
Schedule a free consultation today if you are interested in protecting your elderly parents' assets.