### Safest Way to Manage Finances for a Loved One with Alzheimer’s
Managing the finances of a loved one with Alzheimer’s can be a challenging and emotional task. However, with the right steps, you can ensure their financial security and peace of mind. Here’s a simple guide to help you navigate this process.
#### 1. **Draw Up a Power of Attorney**
The first and most crucial step is to draw up a power of attorney (POA). This document gives you the authority to act on behalf of your loved one in all financial and legal matters. It’s essential to make the POA durable, meaning it takes effect immediately and indefinitely, and general, allowing you control over a broad range of decisions.
#### 2. **Set Up a Trust**
Creating a trust can provide additional security and control over your loved one’s assets. A trust holds their assets, such as the house, stocks, savings, and insurance policies, and appoints a trustee to manage them. This trustee has the power to make investment decisions, spend money, and handle other financial matters. The trust is revocable or amendable at any time, giving you flexibility and control.
#### 3. **Simplify Bill Payments**
To make managing bills easier, set up autopayments for as many accounts as possible. Many banks now offer auto check-writing services, which can be useful for caregivers and household employees. You can also go paperless with bills and statements, or have them sent to you instead of your loved one.
#### 4. **Establish Joint Accounts**
Consider establishing a joint checking account with your loved one or adding your name to their current account. This will simplify manual bill-paying and make it easier to manage their finances.
#### 5. **Get Authorized on Utilities and Credit Cards**
Get yourself designated as an authorized representative on utilities, phone, cable, and credit card accounts. This can often be done over the phone with just verbal permission from the original account-holder. Being an authorized representative will make dealing with these companies quicker and easier.
#### 6. **Simplify Credit Cards**
Pare down and simplify credit cards by quietly putting away most of them. However, don’t close the accounts, as this can hurt their credit history. If you want to keep one card for your loved one, consider using a senior-targeted card that allows you to set a maximum balance and designate where the card can be used.
#### 7. **Secure Their Credit Reports**
Put security freezes on their credit reports from the three major credit bureaus to stop them or someone else from opening new accounts.
#### 8. **Monitor Bank Withdrawals**
While you can’t stop someone from withdrawing funds from their own bank account, you can try to make an informal arrangement at the local branch to call you to authorize withdrawals above a certain amount. Many banks will also notify you via text or email of such withdrawals.
#### 9. **Keep Financial Documents Safe**
Ensure that all financial documents, including tax returns, bank statements, insurance policies, retirement plans, and investment statements, are in a safe location. Keep an inventory of assets and debts, along with important papers like birth and marriage certificates, and legal documents like power of attorney and wills.
#### 10. **Seek Support**
Managing the finances of someone with Alzheimer’s can be emotionally draining. Don’t hesitate to seek support from healthcare providers, financial advisors, or support groups. They can offer valuable advice and help you navigate the complexities of managing someone else’s finances.
By following these steps, you can ensure that your loved one’s financial needs are met while also protecting their assets and reducing the risk of financial exploitation. Remember, it’s essential to act early and collaborate with healthcare providers to make the process smoother and more effective.
