Money Management as You Age: From a Financial Advisor

Managing your day-to-day finances as you age can be time-consuming and even start to feel overwhelming at times. Health and other age-related issues can also reduce your ability to manage your money well in some cases. 

The first step to managing your money as you get older is to understand your situation. Then, ask for help if you need it. Here are three steps to help you get going. 

1. Review your finances

Begin by reviewing financial records and bills to find any potential issues and gauge where you may need help. Your review should include: 

●      Bank statements 

●      Credit card statements 

●      Mortgage statements 

●      Tax records 

●      Investment account statements 

●      Credit reports 

●      Utility payments are up to date 

After you’ve organized your finances, start putting together a plan and budget. If you’re feeling overwhelmed by this process, it’s ok to seek help from a loved one. 

2. Get help with bill paying and decision making

Having someone you trust help manage your finances can be a tremendous help as you age. Creating accounts with joint access, trading authority, or a power of attorney is a good way to get started. 

For daily money management and bill paying, some people choose to use joint accounts. A joint account can let a family member or caregiver easily access money to pay your bills or keep an eye on expenses.

It’s important to know that a joint account means both account holders own the money equally. This gives each person the right to deposit, withdraw, and manage the funds. This may not be what you intended.  

Another option is to give your loved one authorized access. This lets you keep ownership of the money. It also allows them to help manage the account.

Granting a power of attorney to someone may also make sense. Doing so gives that person the ability to legally act on your behalf.

In this regard, you are allowing someone to act on your behalf as if they were you. This can help prevent future disagreements or legal issues among family members. They all want what is best for you.

If you are diagnosed with Alzheimer’s or dementia, think about setting up some financial safeguards early. 

3. Add a trusted contact to your financial accounts

By choosing a trusted contact, you allow your financial institution to reach out to them on your behalf. This is important if the institution has a financial or medical concern. Examples might include: 

●      Financial fraud or abuse. The worry is that someone is taking advantage of a customer. They may be pushing the customer to make financial choices that are not good for them. 

●      Diminished capacity. If a customer shows signs of cognitive decline, and your financial representative thinks they cannot act responsibly for themselves. 

●      Medical emergency at the office. If a customer has a medical emergency and a loved one needs to be notified. 

Trusted contacts don’t have access to transact on accounts, they can’t deposit or withdraw money. The ability to name a trusted contact may not be available on all types of financial accounts. 

Bottom Line

Managing your finances as you age doesn't have to be overwhelming. You can protect your financial well-being by taking small steps. Review your accounts regularly. Get help from trusted loved ones. Add a trusted contact to your accounts. This way, you can make sure your money is handled responsibly.

If you ever feel uncertain, don’t hesitate to seek assistance from family members or a financial advisor who can provide guidance tailored to your needs.

Sources:

https://www.fidelity.com/learning-center/life-events/money-management-as-you-age/

Disclosures:

This information is an overview and should not be considered as specific guidance or recommendations for any individual or business.

This material is provided as a courtesy and for educational purposes only.

These are the views of the author, not the named Representative or Advisory Services Network, LLC, and should not be construed as investment advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. Please consult your Financial Advisor for further information