How to Spot Financial Red Flags in a Parent Who “Manages Fine”

### How to Spot Financial Red Flags in a Parent Who “Manages Fine”

Caring for an aging parent can be a challenging and emotional experience. Sometimes, parents who have always managed their finances well may start to show signs of trouble without anyone noticing. Here are some steps you can take to spot financial red flags in your parent, even if they seem to be managing just fine.

#### 1. **Unpaid Bills and Unopened Mail**

One of the first signs that your parent might need help with their finances is if they have unpaid bills or unopened mail. This could indicate that they are having trouble keeping track of their expenses or managing their mail. If you notice that bills are piling up or mail is going unopened, it’s a good idea to start monitoring their finances more closely.

#### 2. **Unusual Purchases**

Look for unusual purchases on their bank statements. If your parent has always been frugal and suddenly starts making large or unusual purchases, it could be a sign that they are being taken advantage of or are experiencing financial confusion. For example, if they have always been careful with their money and suddenly start sending money to unknown charities, it’s a red flag.

#### 3. **Changes in Financial Accounts**

Keep an eye on changes in their financial accounts. If your parent’s bank balance is consistently lower than usual or if there are large withdrawals, it could indicate that they are being scammed or are experiencing financial difficulties. For instance, if they have always had a high balance in their checking account and now it’s dwindling, it’s a sign that something is amiss.

#### 4. **Defensiveness About Finances**

If your parent becomes defensive when you ask about their finances, it could be a sign that they are hiding something. Financial elder fraud often involves scammers who take advantage of seniors’ trust and generosity. If your parent is defensive or evasive about their financial activities, it’s a good idea to investigate further.

#### 5. **Documentation of Warning Signs**

Document any unusual financial behaviors you notice. Keep track of unpaid bills, unusual purchases, and changes in their bank balance. This documentation can help you identify patterns and potential problems early on.

#### 6. **Legal Precautions**

Consider setting up legal safeguards to protect your parent’s finances. This could include setting up a durable power of attorney, which allows you to manage their finances on their behalf if they are unable to do so. Meeting with an estate planning attorney can also help you establish a living trust or other legal protections.

#### 7. **Protect Against Financial Abuse**

Be aware of potential financial abuse. Scammers often target seniors with sophisticated online schemes. Limit access to credit cards and set up automatic bill payments to prevent unauthorized transactions. If your parent is still living on their own, consider helping them set up automatic payments for essential bills like electricity and water.

#### 8. **Maintain Open Communication**

Maintain open and empathetic communication with your parent. Approach the situation with understanding and compassion. Dementia and other cognitive declines can make it difficult for seniors to understand financial decisions, so it’s crucial to be patient and supportive.

#### 9. **Create Alerts for Unusual Activity**

Set up alerts for unusual activity or large withdrawals on their financial accounts. This way, you’ll be aware of any suspicious transactions and can take action to stop them.

#### 10. **Seek Professional Help**

If you suspect that your parent is being financially abused or is experiencing financial difficulties, seek professional help. Consult with an elder law attorney or a financial advisor who specializes in elder care. They can provide guidance on how to protect your parent’s finances and ensure their well-being.

By following these steps, you can help identify potential financial red flags in your parent and take proactive measures to protect their financial security. Remember, early intervention is key to preventing financial abuse and ensuring your parent’s dignity and independence.