As we get older, managing our finances becomes more of a challenge, but this is no excuse not to stay on top of financial obligations. Letting your parents manage their finances alone is legitimately hazardous to them and their financial health. Hiring a fiduciary for the elderly enables your parents to maintain their independence, ensures their finances are in expert hands, and provides everyone with peace of mind.
At Marcia L. Campbell CPA, we have been helping seniors manage their finances and make the most of their golden years for decades. Read our blog to learn how a fiduciary for seniors works and why they are invaluable.
A Private Fiduciary for the Elderly: How They Work
Understanding the purpose and value of a fiduciary requires understanding what they are, what they do, and how to recognize the signs that your parents would benefit from hiring one to manage their finances. Let’s get into it, shall we?
Related Article: The Benefits of Hiring a Private Fiduciary
What is a Professional Fiduciary for the Elderly?
A private fiduciary is, essentially, a person or company who manages money or property for someone else. This legal arrangement is sometimes court-appointed, but in other situations, an individual will select and enlist the services of a fiduciary.
Often, people will choose a CPA for this role because of their financial expertise. A fiduciary has a legal duty, known as their fiduciary duty, to:
- Act and make decisions only in the interest of the person they are helping
- Not act or make decisions to benefit themselves
- Manage the person’s money or property per state and federal laws and regulations
- Keep that person’s assets and property separate from their own
- Keep meticulous records and report to that person as required
If a fiduciary doesn’t uphold these duties, you can pursue legal action to reverse any damages done and remove them from their position, which is an added layer of protection.
Related Article: How to Prepare for Taking Over Elerly Parents’ Finances
What Does a Private Professional Fiduciary for the Elderly Do?
If you are in a position to start taking over elderly parents’ finances, you already know that this is a huge responsibility. From monitoring income to budgeting to reviewing bank statements to paying bills for elderly parents, this a full-time job.
A fiduciary offers a range of financial services for the elderly to help when managing parents’ finances. A fiduciary for the elderly will assist with:
- Organizing and reviewing finances
- Paying bills
- Budgeting
- Managing day-to-day income and expenses
- Coordinating with other professionals, like attorneys, for their wellbeing
- Providing recommendations for in-home caregivers and other services
- Protecting your parents from scams, fraud, and financial exploitation
- And much more
“One of the biggest benefits of working with a fiduciary for the elderly is their legal obligation to act in your parent’s best interests. When families reach this point, sometimes a family member will volunteer to take on this responsibility. Because they don’t have a fiduciary duty to uphold and complex family dynamics get in the way, too often we see people abuse their positions. But you don’t have to worry about that when you work with a private fiduciary!”
-Marcia L. Campbell, CPA for Seniors
Just as crucial, these services will help your parents maintain their independence and dignity to enjoy their golden years.
When it comes to managing elderly parents’ finances, a professional fiduciary for seniors is a versatile tool that you can use in different ways.
- Trustee services: After setting up a trust with an attorney, your parents can transfer funds, assets, and property into it. Afterward, they can assign a professional fiduciary as the successor trustee to manage all the assets, funds, and property held in the trust to pay their bills, distribute money to them, collect and manage income, track and manage expenses, and more.
- A financial power of attorney: A financial power of attorney gives someone the authority to act on behalf of someone else, and your parents can tailor it to their needs. You can designate a fiduciary to oversee a specific bank account to sign checks and pay bills for your parents, or they can receive a broader scope of power.
Related Article: Daily Money Managers for Seniors: Power of Attorney or Trustee Services
When Should You Get Professional Fiduciary Services for Seniors?
It can be hard to know when it’s time to start taking control of elderly parents’ finances and enlisting the help of a professional fiduciary for the elderly.
If you act too late, they may mismanage their finances and do irreversible damage. If you act too soon, you could severely limit their independence and damage your relationship with them. Signs that it’s time to work with a fiduciary for the elderly include:
- Your parents fall victim to financial abuse, fraud, scams, or exploitation
- Money is disappearing from their accounts via suspicious withdrawals
- Your parents are giving money to a caregiver or a romantic interest
- Your parents are in a state of cognitive decline
- You see stacks of unopened bills when you visit them
- Their family or friends are attempting to take advantage of them
Related Article: How Do You Know if Your Parents Are Struggling with Money? Pt. I
Do Your Parents Need a Fiduciary for the Elderly? Schedule a Consultation Today!
Managing your parents’ finances is a full-time job, and you already have your own professional and personal obligations to stay on top of. You and your parents deserve peace of mind, and anything short of hiring a fiduciary for the elderly is a disservice to them!
Visit our Contact Page to schedule a consultation to ensure your parents are in expert hands and everyone can feel relief when this burden is lifted from your shoulders.
