Protecting Your Parents’ Money

In those days Hezekiah became sick and was at the point of death. And Isaiah the prophet the son of Amoz came to him and said to him, “Thus says the LORD, ‘Set your house in order, for you shall die; you shall not recover.”
2nd Kings 20:1

This morning I needed to get a letter of instruction notarized at my bank. The notary public was a little rattled. She had just spent an hour with a child dealing with the sudden death of a parent. Although he had the now worthless Power of Attorney and the key to the safety deposit box, his name was not on the safety deposit box access list. Unraveling this conundrum involved the bank’s attorneys and teleconferences with “back office” experts.

This shouldn’t have happened.

I have recently finished Protecting Your Parents’ Money by Jeff D. Opdyke. Because my parents did not read this book or have what the author terms, “the talk” with their son ten years ago when it could have helped, I found dealing with this material emotionally difficult.

If you or one of your parents are pushing 70, if you have suffered a stroke, if you have early signs of Alzheimer’s, Parkinson’s, or any indication of the possible onset of a neurodegenerative disease that might lead to dementia; if you have a heart condition or any hint that you might die soon or in a sudden untimely manner, you need to have “the talk.” Parents you need to sit down with your children and prepare for the day you will no longer be able to care for yourself or for the day of your death.

Your children need to have access to all your documents. These documents need to be up to date and to accurately reflect your current wishes. These include but are not limited to wills, trusts, living wills, durable power of attorney, power of attorney for health care, advance directives, insurance policies, and HIPAA authorizations.

Your children need to understand how much money you possess, where it is located, and how and why you are managing it in a particular manner. This would include bank accounts, credit cards, stock and bond portfolios, businesses, and property.

This book covers situations involving well healed families as well as dealing with situations where mom and dad are no longer able to make ends meet. This can be a little distracting as Opdyke jumps from the dangers of purchasing a $250,000 annuity to provide a lifetime income stream to budgeting for your parents in instances where it is unlikely that their money will outlive them.

The author discusses housing. This topic includes selling the old home place to free up cash, especially if mom can no longer cut the grass of fix the leaky old roof. The reverse mortgage is discussed at length, along with senior communities, and the possibility of mom moving in with her sister, Aunt Margaret. All these options have their own particular pitfalls and advantages.

Finally, the book introduces the reader to the wacky world of healthcare. Medicare, Medicaid, health insurance, medigap polices, as well as private pay options are all covered in a basic introductory manner, giving the reader just enough information to (hopefully) ask the right questions. One thing the author didn’t mention in this chapter just drives me crazy. The elderly receive both statements and medical bills that both look like they need to paid. Sometimes they end up double paying for a procedure that was covered by insurance or Medicare. It is difficult and time consuming to recover that money. Often the bill has not been submitted to insurance or submitted improperly. If insurance denies payment that is not the end of the story. My mother in law’s last ambulance ride was denied. The coding did not indicate that it was an emergency. At the time three separate conditions could have ended her life at any moment. Less than a week later she was dead. My wife spent hours on the phone straightening out that mess.

Throughout the book the author explores the dangers that face seniors in our society including children who rob them blind, “friends” or home health aides who help themselves to your parents’ possessions and credit cards, or financial planners who sell inappropriate investment products, making themselves rich at the expense of confused frightened old ladies. In the face of these real dangers, combined with the paranoia that is often associated with dementia, and a parent’s understandable desire to remain an independent adult the author suggests various conversation starters that will allow children to explore these very sensitive issues without frightening or angering mom or dad.

This book is worth reading if you or your parent might be on the edge of approaching that final chapter of their life. Check it out or better yet buy a copy. It will help you ask the right questions and hopefully find the right answers.