Critter Corner: Tips for Seniors for Financial Literacy Month

Dear Hayek,

I am a caregiver for my 82-year-old mother. Sometimes she could use help with making financial decisions. What tips can you offer to me as a caregiver and to her as someone who still handles her own finances? Also, I have two children in their late 20s, and neither one of them is very financially savvy. Do you have any recommendations for how to teach adult children to be financially responsible and make better financial decisions?

Thanks for your help!

Finn Nances

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Dear Finn,

April is Financial Literacy Month, a month that highlights the importance of financial education. Financial literacy is important for everyone, including our older loved ones and our adult children!

Financial literacy offers individuals the ability to make smart, informed decisions about their financial resources which can include money, housing, transportation, credit and debit cards, emergency savings, retirement planning, and much more. Financial literacy month offers a chance to identify areas of our financial lives that need the most attention, and to focus on educational tools and resources that can help you and your loved ones.

One of the best tools around is the Financial Education System and Financial Literacy 101 courses offered by Protection Point Advisors (PPA), a Registered Investment Advisory firm with which I am affiliated. PPA’s Financial Education Library contains almost 150 educational modules that you can take as several different courses in a specific field of study, or browse at your lesiure and learn specific topics individually. They also feature a new financial theme each week.

Here are a few areas in financial literacy which seniors can benefit from exploring this month (or any time):

1. Know where your money is going.

Budgeting is very important at all ages, but especially so for seniors who live on a fixed income. Create a list of all of your monthly expenses with your mother, including groceries, gasoline, insurance costs, co-pays, medications, and more, and track your spending throughout the month. It’s important to have the peace of mind of knowing exactly where your money is going. PPA’s Financial Education Library contains 8 separate modules to help you and your mother and your kids learn about budgeting and spending.

2. Beware of people offering to help, especially when making purchases.

Not everyone who offers assistance will have your loved one’s best financial interest in mind. Encourage her to be cautious of friendly strangers who make offers that sound too good to be true, or pressure her to sign a document or make a purchase immediately without adequate time for review or comparison. Always make sure her questions are answered fully. If she doesn’t understand a financial term or document, suggest that she doesn’t sign anything until it’s clear.

PPA’s Financial Education Library contains 4 separate modules to help you and your mother protect against identity theft, and our Everything Elder Law blog contains dozens of articles on different scams targeting seniors and how to avoid them.

3. Plan ahead.

As we age, we sometimes need help managing our finances, so it’s essential to plan ahead. This goes for caregivers and their loved ones. Who will manage your bills if you are hospitalized or if you become unable to do it yourself? Think about someone whom you trust, who could help during a medical crisis, and create a plan in writing. Be sure to talk to your family or close friends during the planning process and pinpoint a trustworthy person or persons to be agent under your Financial Power of Attorney, to handle your finances when you can no longer do so yourself.

Take action today to create your incapacity plan and discuss it with someone you trust to ensure financial peace of mind in the future.

Hope this helps!

Hayek