If you have to take care your parents' financial life all of a sudden, it could be extremely stressful. However, if you can make a good approach towards it and initiate step by step money management, you'll get a fair idea about what needs to be done to manage your moms finances.
May be you are not with your mom right now, but at this point below given steps can help you to decide what to do now:
Step 1: Find and check your mom's financial accounts and documents
You may not like it, but most of the moms normally hide their financial situation from their children. She will hesitate to uncover herself as she might not be comfortable to explain her bad condition to you. So, it is your duty to make things happen. You need to be a financial detective and need to . If your mom keeps her bank and investment files in front of your eyes, it will be easier for you. If it is not in your grasp, your next step is to .
Check the Schedule B, from there you'll get the listed dividends and interest incomes. You'll also get the names of financial institutions with whom your mother is associated financially. If you think that your mom worked with a professional consultant like an accountant or attorney, it is your duty to communicate with the person immediately. If you are lucky, he or she will inform you necessary financial details about your mom.
Important tip: If your mom is still in a good shape and health, encourage her to , along with the . If possible, tell her to list up the consultants she has worked or working with for safety reasons. Make her feel that her secrete financial whereabouts is safe with you and it is wise to make a trail of information in an emergency.
Step 2: Collect the bills and start paying
If your inner “concern” bothering you that your mom, being not so financially strong, won't be able to manage her bills and medical expenses, you need to just cool down yourself. (expenses) before start working on bills. You can consult an elder care attorney to get help on preparing a payment schedule according to priority.
If your mother has solid status in terms financial ground, pay all the due bills asap. . Try to be current on every aspects, from utilities to credit cards or medical, whatever it is. If you don't know the details of your mom's checking account, adjust your priorities and pay her bills yourself. Later, at any point, you'll be getting the reimbursement from your mother. But to be on a safer side, be absolutely sure that your mom has enough money to pay you back.
Important tip: As your mother grow older, . These companies will automatically provide you monthly statement copies of your mom. You can spot an error or problem before it becomes a headache.
Step 3: Look for the power of attorney or other documents
If your mother assign you as her agent, you'll require some documents to authenticate your signing powers over her any financial decisions.
Getting listed in power of attorney paper is very much important, it will be needed each time you deal with any new financial organization. If your mother adds your name in her POA, you can manage her financial accounts and can make any important financial decision behalf of her. For an example, if your name is not added in your mother's checking account, but , . Even bank will also cooperate and tell you your mom' checking account balance.
It is important to be cautious while taking the mailing power of attorney from your mom. Bank or financial institutions will require to see the original papers to verify your authority. So, you might need to consult a professional to prepare an additional copy of your POA.
Important tip: These are the you might need to handle your mom's finances:
- A POA or power of attorney form, it will give you the authorization to take care of her finances.
- A health care proxy, it will give you the authorization to take medical decisions.
- A will, it will define the distribution of assets after your mother's death.
Step 4: Document each transaction you made on your mother' behalf
If you pay mom's bills, remember to . Keep the images of the checks you have issued and tally with bank statements, too. If you have to pay anything for hard cash, keep . It will help you in case you are having trouble with any financial institutions regarding your mom's debts.
Important tip: It is advised that you should . Don’t mess up the bank credit card documents along with her checking account details or tax return files.
Step 5: Hiring a financial planning team (optional)
You might consider yourself as good in money management, but don't guess what ever decision you will be making towards your mom's financial life, will be best. So, , get help from outside professionals as much as possible.
Important tip: Financial professionals like planners, tax attorneys can guide you to avoid expensive and critical financial mistakes. They can your mom's money.
These are the most important aspect you'll need to focus if you are planning to help your mom regarding managing her finances. So, start initiating the plan of action from today, so that you can free your mom from any kind of financial stress, from this Mother's day onwards.