Families in Colorado and all around the U.S. must be on the lookout for people trying to take advantage of their aging loved ones. Whether it’s due to illness, dementia or simply the effects of aging, older people are unfortunately a prime target for fraud due to diminished mental capabilities. People who commit financial abuse of the elderly are not always typical criminals either. Trusted people such as advisers, brokers, clergy and even other family members can end up swindling an aging person out of thousands of dollars. Luckily, there are clear signs to watch out for, as well as some legal maneuvers that can be taken to help prevent this type of abuse.
The National Endowment of Financial Education first recommends keeping an eye on how an aging family member handles their finances. A NEFE study found that, out of the aging people experiencing cognitive decline, 47 percent were behind on paying bills or were not paying them at all. Thirty-six percent of people could not complete simple math problems, and 35 percent made purchases that were considered irrational. Twenty-one percent even completely depleted their bank accounts. If you notice any of these things happening, it’s time to get assistance and protection for your aging loved one.
If a child of the ailing family member decides to move home and take care of their parent, it’s important to be vigilant. Unfortunately, children who have had past conflicts with their parents or are financially troubled can sometimes end up taking advantage of their parents. It’s best to have an honest discussion with any family members who will be directly taking care of an elderly loved one. Devise a plan for handling the parent’s finances and maintain a schedule for communication if you no longer live nearby.
Another way to look out for an aging family member’s finances is to establish a power of attorney with and estate planning attorney. This person will have the legal right to make financial decisions for the elderly family member. A power of attorney can be a member of the family or any person that can be trusted to handle the ailing person’s finances.
Source: forbes.com, “Year-End Mission: Spot Signs Of Elderly Financial Abuse” John Wasik, Dec. 23, 2013