Esther Koch (right) talks to her mother, Harryette, at Carlmont Gardens nursing home in Belmont. Photo by Ron Lewis
Early Action Eases Way When It's Time To Take Care For Parents' Financial Affairs
By Francine Brevetti│Business Writer
Jacqueline Marcell gave up her job as a vice president for International Video Productions in Southern California and moved back to the Bay Area to take care of her parents when she realized they were suffering from Alzheimer’s disease.Marcell admits that both she and her parents’ doctors missed early signals that could have prepared them for their growing disability. Missing signals.There are plenty of indications it’s time to step in an d take care of one’s elderly parents’ financial affairs if one is alert, according to gerontologists. “Seventy million baby boomers are not educated about elder care because their parents never took care of their parents, so they didn’t learn how,” Marcell said. Marcell now knows she could have used long-term care insurance, durable power of attorney and other mechanisms to ease the financial, emotional and physical stress on herself and her parents. Instead, she and her parents spent all their savings on round-the-clock caregivers for five years. Since then, Marcell has become an advocate for caregivers of the elderly and has written a book, “Elder Rage,” available at www.elderrage.com, on caring for aging parents. Recognizing the early signs of dementia or an encroaching disability – and knowing how to broach the topic with your parents – can help forestall unnecessary financial and emotional distress, Marcell and others said. “You have to investigate with open eyes,” advised Esther Koch, a certified public accountant, gerontologist and consultant with Encore Management in San Mateo.“You have to look at evidence such as stacks of mail.Is the home clean and uncluttered as usual?Open the fridge – that will tell you something.” Koch honors her mother, who is suffering from dementia, at her Web site, www.ENCOREmgmt.com. Jenny Guttman, an Oakland CPA, encourages children of the elderly to take the initiative to look at their parents’ checkbooks to see how the money is flowing in and going out.“That will tell you a lot,” she said. Stephen “Shags” Shagrin, a Walnut Creek money coach, said his wife first detected her mother’s onset of dementia by looking at her credit card bills.Although his mother-in-law had the money to pay the complete balance, she was paying only the minimum.Asked why she was doing so, the elderly woman could give only a confused response. Clues like this are red flags that one’s parents’ finances are topsy-turvy and need a helping hand, said Shagrin, whose Web site is www.planningforlife.info. Before you take any concrete steps to assume your parents’ responsibilities, experts say you must first broach the subject in a casual conversation in a relaxed setting. It may take several months to make your parent aware and accepting of the fact that he or she needs help. “We tell clients it is a no-no to step in and take over.Folks from the Depression-era take pride in their independence,” said Ted Sarenski, a CPA in Syracuse, N.Y., and spokesman for the American Institute of Certified Public Accountants, a national professional organization. When Sarenski’s mother’s faculties stared to fade, he said his sister started having dinner with their mother regularly to go through her mail and help her with her bills in a calm, cooperative fashion. After several months, Mrs. Sarenski agreed to give her daughter power of attorney. “You don’t want to humiliate your parent,” agreed Koch, the San Mateo CPA. Guttman had to face this challenge recently with a highly successful businessman and philanthropist who had been her client for years. Now in his 80s, he occasionally has trouble focusing or following a conversation. She took him to lunch to broach the subject.
“I said to him, ‘We all reach a point in our lives when we have to trust our children to make important decisions about our money and our business.I want you to be open-minded and bring your wife and children into these decision about money,’“ Guttman said.“He asked me, ‘Have you seen me like that yet?’ I said, ‘Yes, when I showed you your tax return.You got confused.I don’t want you to be alone at meetings.You need representation.’” As it turned out, the client was relieved to hear this and admitted he had wanted to slow down for a while, Guttman said. Early intervention is crucial, financial experts say, since it is essential to establish your name on a joint banking account well before your parents become incapacitated. Establishing joint accounts can be considerably more difficult if financial institutions recognize your parent as being unable to make financial decisions, and may require you to see a lawyer to embark on a process of conservatorship, which can be lengthy, expensive and time consuming. If your parent has several accounts, consolidate them by transferring funds, Koch advised.This will make your life easier. Because parents’ creditors will not speak to you without your parent, you must be together when you call them. This is also true for talking with the Social Security Administration about your parents’ benefits.To handle your parents’ bills, you might ask creditors to debit your parents’ bank accounts directly. Or change your parents’ address to your own, making sure not to give the impression that the debt is in your name (and therefore not to inherit your dad’s debt when he dies). If your parent doesn’t have the means to cover his responsibilities, you may have to talk to the Social Security Administration and determine what benefits are available for him. Experts say you should definitely establish power of attorney, both over your parents’ health decisions, as well as they legal affairs – which allows you to sign their checks and tax returns, run their business or enter into contracts for them, or buy or sell real estate in their names. Still, this is likely just the beginning of your changing relationship with your parents. You may also be dealing with your siblings’ reactions and the status of your parents’ estate.You may be thinking of getting professional help to manage dad’s affairs or of looking into a conservatorship, which would make you your parent’s guardian. Like Koch, many say assuming these extra responsibilities changes their relationship with their parents. Koch had always been “daddy’s girl” and said her relationship with her mother had always been competitive and strained.But after her mother was diagnosed with leukemia, Koch decided to change her interaction with her mother. Koch recalled sleepless nights, long to-do lists, work absences, canceled social events, hospital advocacy and endless coordinating phone calls in taking over her mother’s affairs.
o balance this stress, Koch urged others like herself to seek out relief, a change of pace and opportunities for joy. “If I only thought about what I need to do for my mother, the stress of caregiving would be overwhelming,” she said, “and at times it has been so even for me, a trained gerontologist.” Contact Francine Brevetti at (510) 208-6416 or firstname.lastname@example.org. WARNING SIGNS Experts say to be alert to warning signs that your parents may be unable to care for their finances: ► Their mail is unopened, stacked up or stuffed away in bags or closets. ► Their formerly tidy house or dress is showing signs of neglect. ► The refrigerator’s contents are old and in disarray. ►Your parents’ checkbook register has not been maintained. ► Their utilities have been shut off or other bills left unpaid. RESOURCES ► American Institute of Certified Public Accountants primer on the basics of personal finance: www.360financialliteracy.org ► Alzheimer’s Association: www.alz.org, (800) 272-3900 ► American Association of Daily Money Managers: www.aadmm.com, (877) 326-5991 ► Family Caregiver Alliance: www.caregiver.org, (800) 445-8106 ► National Academy of Elder Law Attorneys: www.naela.org, (520) 881-4005 ► National Association of Personal Financial Advisors: www.napfa.org (800) 366-2732 ► National Council on Aging, BenefitsCheckUp, www.benefits-checkup.org ► Jacqueline Marcell’s Web site, www.elderrage.com, presents a comprehensive list of helpful Web sites. ► Adult Protective Services: Alameda County, (510) 577-1900 Contra Costa County, (877) 839-4347 San Joaquin County, (209) 468-2202 San Mateo County, (800) 675-8437
*Article appeared in the following newspapers on April 13, 2007 – Alameda Times-Star; The Argus; The Daily Review; The Oakland Tribune; San Mateo County Times; and Tri-Valley Herald