How to Talk to Your Parents About Account Information

Starting the Conversation

Start discussing money management with accounts as soon as possible, according to a financial adviser in Seattle in an email with The Balance. Don’t wait until a medical issue such as a stroke or a degenerative condition like dementia or Alzheimer’s leaves a parent unable to communicate.

You may encounter resistance initially. “If that’s the case, acknowledge their feelings. Understand that it’s difficult, but you would like them to think about it more,” said Catalano. Bring the topic back up again once it’s appropriate.

It’s suggested to ask open-ended questions like: “If anything happens where I or one of my siblings has to step in to pay your bills or deal with your other financial issues, how do you feel about handling that comfortably?”

Creating a Plan

First, you’ll need to determine when and how you will have access to your parents’ accounts. For example, your parents might want help with financial matters as they age. In other instances, a parent may only want assistance with paying bills if they lose mental capacity, or they may not even wish to share information even after passing away.

For instance, California estate attorney Carmen Rosas told The Balance via email that her father recently underwent eye surgery and was unable to log into accounts to pay taxes and credit card bills. Thankfully, she and her brother were able to create a spreadsheet with account login information shared via email to pay bills on his behalf.

Let your parents know you’re interested and willing to help, capable of making decisions in their best interest, and will include them in the decision-making process. You will keep their funds separate from your own and maintain good records and receipts for everything they receive or spend on their behalf. Keeping records might involve tracking money, investments, properties, debts, paid bills, and information regarding eligibility for governmental benefits or from an employer.

Discussing Access Roles

The laws vary by state when implementing the preferred model for managing financial matters. Check with an elder law attorney and/or your bank to learn more before taking action, and ensure that the roles are part of the estate plan. Options for accessing a parent’s accounts include:

• Guardianship/Conservatorship: A property guardian can be appointed by the court or designated in estate planning documents. However, a guardian or conservator cannot act on your behalf until you are incapacitated.
• Durable Power of Attorney: A person with a durable power of attorney can act on behalf of the parents regarding money or property. This allows you, as the agent, to pay bills or manage other financial matters before incapacitation – and after as well, or even after the parents’ death.
• Springing Power of Attorney: This type of power of attorney only comes into effect upon mental incapacitation and often requires verification by a doctor.
• Joint Accounts: If one of your parents adds you to their account to create a joint account, you will have access to the funds just like the parent. While this can ensure some convenience by monitoring the parent’s spending and saving, you will also incur any liabilities as a joint account holder.
• Executor: This is the person named in your parents’ will to handle their financial affairs after their passing. The executor can be the same person or a different person than the conservator or parent’s agent.

“Establishing a durable power of attorney and trust document is always the best way to protect your parents’ assets”
Source: https://www.thebalancemoney.com/how-to-talk-to-your-parents-about-account-information-6256722

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