My elderly mother has no idea how to manage finances, what do we do?
August 11, 2018 2:36 PM   Subscribe

My deceased father used to take care of ALL of their financial matters, aside from a few investments my mom used to have. Since his death, I've realized that she has *no idea* how to manage finances, do her taxes, deal with banks, look after retirement savings, etc. I guess I have to somehow take over and be her representative for these matters, but I have idea how to do this!!

I should preface this with saying we are Canadian, so any Canadian-specific advice is appreciated.

I assume that we need to go to a lawyer and get some sort of power of attorney set up? I'm really confused.

I wouldn't say that she's "not of sound mind" or anything, but with finances she just does not know what is going on and has not taken any initiative to figure out what's going on. For example, there was a mistake on her taxes this year which caused the government to claw back her Old Age Pension. She didn't notice that the bank neglected to give her the proper tax form to off-set the money she received from my dad's RRSP, so it was counted as income! She didn't show me the letter saying this until today! When I ask her financial questions every answer is almost always "I don't know!" she doesn't know what's going on with her RSPS, which have become RIFS since she's over 71, who knows if they're going to be deposited all at once into her account or slowly! She has no damn idea and neither do i!!! She's 73 never had any inclination to learn how to use a computer, so I do online banking on her behalf... but I'm pretty sure this is not allowed! We need to get this sorted before it's too late, I think.

Like, it's ridiculous! This is actually causing a lot of contention between us right now. It's very stressful because I just don't know what's going on with her money and I want to make sure that she has enough to live out the rest of her years, but she has no idea what's going on financially.
posted by anonymous to Work & Money (7 answers total) 3 users marked this as a favorite
You definitely want to get power of attorney as soon as possible. This will allow you to legally act on her behalf on financial matters. You do want a lawyer to help set it up so you have your bases covered.

Once you have POA, make an appointment at her bank to work through her finances. If she is up to it, she can come too. Otherwise, you can explain the situation to the financial advisor - they have heard of this before, you aren't doing anything out of the ordinary. If her stuff is at different banks (e.g. retirement vs. investments vs. chequing) you will need to go to all of them. If you are in a position to consolidate to one bank, this will make the bank staff particularly eager to work with you (and would make your life simpler).

If she has someone doing her taxes - fire them. That sort of mistake is unforgivable. If she is doing them herself, you might want to use tax software to handle (usually a single purchase covers up to five returns, so you can do hers, yours, etc.)

I hope this helps.
posted by obliquity of the ecliptic at 3:03 PM on August 11, 2018 [1 favorite]

Here's some Canada-specific power of attorney info. Your mother seems to be willing to let you take care of some financial matters on her behalf, like the online banking. My suggestion is that you try for a non-contentious* talk where you basically say, "Mom, I will do everything for you just the way Dad did, so you don't have to worry about it. To do that, we need to set up a power of attorney that authorizes me to do that. You can take it back out of my hands anytime you want, and all the bank accounts will be join accounts so you also have access to them." Visit a lawyer with her so she gains confidence that this is a good arrangement.

The other option, if she doesn't want you to do this for her, is to see if she would trust somebody else, like a bookkeeper/accountant, to take care of it. But she needs to be convinced that she can't do it herself.

*I say non-contentious because you appear to be doing some of the contending yourself, based on the wording of your post. Take a deep breath and do all this calmly, and it will go better.
posted by beagle at 3:05 PM on August 11, 2018 [1 favorite]

Yes, I agree a POA is appropriate, and I chime in on obliquity's advice. I paid her bills using a checking account with her name and mine as POA - the bank will know how to set that up. Fortunately, Mom had a financial advisor who was friendly, and though it was his business to sell her various annuities he was honest and helpful and all the various things paid up when she died. I would also make sure she has an attorney and a current will, and make sure any annuities, life insurance policies, etc. are set up as she wants them. If there is other family around they can be surprisingly difficult about money when someone is failing. Despite my mother's attempt to be careful about that, and even though my sister was the one who nagged me into taking care of my mother's finances, my sister pitched a fit when she thought I was trying to take more than my share.
posted by Peach at 3:09 PM on August 11, 2018 [1 favorite]

First, I'm so sorry for your loss.
I am in the USA, but after Mom died, I became a POA but only at my Dad's bank - we didn't have to do anything with lawyers, we just did some paperwork with his bank (Wells Fargo). We had looked into making me a legal official POA, but here there is a lot more to being a legal POA than just paying bills (like if someone sued me, they could go after Dad's money b/c I was POA kind of stuff). So we ordered checks from his bank with my name as POA and I have access to everything, but only at that one bank - which is the only one he uses and that is all I needed. Maybe they have this version of "POA lite" in Canada too? It was a great solution for us.

It sounds like you're going to have to get her set up with an online account to make things easier for you. One thing I did was for two months after Mom died, I checked all the incoming bills - Dad was good about putting any bills on the microwave and every few days I'd stop by and we'd go through them together and then add each one to his online bank account as a bill. Next, we drew up a sample monthly calendar of when certain bills were due and made a monthly budget so there wouldn't be any surprises. We did as much direct deposit with incoming money too - saves a lot of time and trips to the bank to deposit checks. It took some time, and there were a lot of phone calls we made to take her name off things and make sure he was only being billed for one person now, but its worked well for us. I got VERY lucky and Dad decided to try paying his own bills online and he really enjoys it.
Good luck to you.
posted by NoraCharles at 3:50 PM on August 11, 2018

So in the U.S.—not sure about Canada, but hopefully it exists there, too—there are people whose sole business is managing routine financial affairs, usually for the elderly. The main U.S. organization is the American Association of Daily Money Managers (daily to differentiate from money managers who manage long-term investments). If you have the resources, it might be worth researching someone like that to whom you can outsource the work. I’ve done that and WORTH IT.
posted by whitewall at 9:49 PM on August 11, 2018

This is actually causing a lot of contention between us right now.

What is the point of contention? She doesn't know, and she isn't going to learn.
posted by DarlingBri at 12:51 AM on August 12, 2018 [1 favorite]

It sounds as if you both don’t really know how to work through this, not just her. You need to sit down, together, and agree how she would like to deal with the situation. If she can’t or won’t learn that’s ok. She’ll need somebody to help. That can be you or a third party. That person may well just need poa with each financial institution, not poa for all her affairs. Or indeed no poa.

I do my father‘s tax return without having poa, he just collects all papers in a place and hands them to me. I do the return and tell him where to sign and he submits it. All his bills are direct debited. It works for now but he has set both my brother and me up as signatories on his bank account. His affairs are simple and this is not Canada. But what I am saying is this doesn’t have to be all complicated and formal from the get go. Until you work things out perhaps your mother could just put ALL letters from banks, the tax authority and all bills in a box and you go through them once a week or once every two weeks and take action, with her, as required.

If she doesn’t want to do anything herself that’s ok. Then she needs to get you set up so third parties can deal with you. There are different ways of doing this. And I agree that there are wider issues to consider. She may not have an up to date will and may not have considered the need fo a medical poa down the road. So whilst you could probably get poas with banks without talking to a lawyer you probably should talk to one and get them to walk you through various considerations. Perhaps also an accountant, if there are enough assets. She not going to get any younger or have an easier time dealing with things in the future and different problems will present themselves. And it sounds as if you may not have spent a lot of time discussing these things in the past. So now is the time to work out what she wants and make sure the paperwork to facilitate that is put in place.
posted by koahiatamadl at 3:48 AM on August 12, 2018

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