Aging and Financial Decision-Making: Do Mom and Dad Need Your Help?

A recent study out of the University of Alabama identified key warning signs that signal that aging adults are suffering from a decline in financial decision-making abilities. Researchers found that early warning signs that may be present include:

• Needing more time to finish financial tasks, such as paying bills or doing income taxes
• Overlooking important details, such as failing to realize a bill is overdue
• Having a hard time with “everyday math,” such as making change or calculating a tip at a restaurant
• Declining comprehension of financial concepts, such as interest rates or medical deductibles
• Failing to appreciate financial risks, such as focusing on the potential returns of an investment instead of the possible downside

If you are concerned about a decline in a loved one’s financial decision-making skills, be proactive and take action early on when the warning signs first appear.  Talk with your loved one to get a handle on what steps they may have already taken to protect themselves financially, such as whether they have a Will, power or attorney or living will/health care proxy. Concerned friends and family members should meet to discuss ways to help the person experiencing a decline in the least confrontational and most respectful way. Attorneys and financial planners can assist you in making sure your loved one is protected and that his or her wishes are honored.