Five steps to help ageing parents manage finances

The Ritcey Report

December 20, 2016

As the population ages, many Canadians will find themselves managing wealth for their parents. This is a problem that, typically, emerges by stealth. Unopened mail. Large cash withdrawals. Changes to legal documents. These and other warning signs may point to problems but – more often than not – an ageing parent’s difficulty managing their finances is less obvious.

The Alzheimer’s Society of Canada reports that 15 per cent of seniors — about 747,000 — are living with some form of dementia. If you know seven seniors, the odds are at least one of them has some form of cognitive impairment.

Here are five proactive steps you can take to help your parents manage their finances as they age. Great care should be taken to consult their existing financial advisor, should they have one, of the steps you are suggesting be taken. A sensitively managed, coordinated approach is crucial in situations like this:

  1. Consolidate accounts – If your parents have multiple bank and investment accounts, try to reduce the number of accounts and institutions. They will likely benefit from lower fees and a more integrated approach.
  2. Review statements – If they’re comfortable sharing their financial details, your parents might be able to set you up to receive – again, with the assent of their existing financial advisor, should they have one – copies of their statements.
  3. Prepare a financial data organizer – Summarize accounts and advisers, details of any life insurance policies, if they have safety deposit boxes and where to find important legal documents and account passwords.
  4. Hire a financial planner or private banker – Says Andrew Wright, managing director and head of private banking at Scotia Wealth Management: “A private banker can service the client’s day-to-day banking needs and work with partners at Scotiatrust to help establish a power of attorney for property to ensure assets are protected when parents are no longer able to manage their own finances.”
  5. Review their estate plan – It is important to ensure that wills, powers of attorney, personal directives and similar documents are up-to-date before it is too late.

Following these five steps allows ageing parents and those children taking care of them, to live their financial lives with complete confidence.

Says Roxana Tavana, managing director and head of Scotiatrust at Scotia Wealth Management: “When you have everyone at the same table — wealth adviser, financial planning, trust services, lending services and private banking — that’s when the magic happens. That’s when we can deliver clients the peace of mind that comes with making progress towards achieving the life they envision, across all life stages.”

For further information on this issue, or if you have any questions, contact Dave Ritcey, The Ritcey Team, 902.678.0048