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Your Bank > Education and Advice > CNB University

What It Means to Be a Financial Caregiver for Your Parents

Margaret Meyer
Margaret M. Whelehan is Vice President - Personal Banking/Insurance Agency Manager and can be reached at MWhelehan@CNBank.com or (585) 249-4980 x41034.

If you are the adult child of aging parents, you may find yourself in the position of someday having to assist them with handling their finances. Whether that time is in the near future or sometime further down the road, there are some steps you can take now to make the process a bit easier.

Mom and Dad, can we talk?

Your first step should be to get a handle on your parents' finances so you fully understand their current financial situation. The best time to do so is when your parents are relatively healthy and active. Otherwise, you may find yourself making critical decisions on their behalf in the midst of a crisis.

You can start by asking them some basic questions:

  • What financial institutions hold their assets (e.g., bank, brokerage, and retirement accounts)?
  • Do they work with any financial, legal, or tax advisors? If so, how often do they meet with them?
  • Do they need help paying monthly bills or assistance reviewing items like credit card statements, medical receipts, or property tax bills?

Make sure your parents have the necessary legal documents

In order to help your parents manage their finances in the future, you'll need the legal authority to do so. This requires a durable power of attorney, which is a legal document that allows a named individual (such as an adult child) to manage all aspects of a person's financial life if he or she becomes disabled or incompetent. A durable power of attorney will allow you to handle day-to-day finances for your parents, such as signing checks, paying bills, and making financial decisions for them.

In addition to a durable power of attorney, you'll want to make sure that your parents have an advance health care directive, also known as a health care power of attorney or health care proxy. An advance health care directive will allow you to make medical decisions according to their wishes (e.g., life support measures and who will communicate with health care professionals on their behalf).

You'll also want to find out if your parents have a will. If so, find out where it's located and who is named as personal representative or executor. If the will was drafted a long time ago, your parents may want to review it to make sure their current wishes are represented. You should also ask if they made any dispositions or gifts of specific personal property (e.g., a family heirloom to be given to a specific individual).

Prepare a personal data record

Once you've opened the lines of communication, your next step is to prepare a personal data record that lists information you might need in the event that your parents become incapacitated or die. Here's some information that should be included:

  • Financial information: Bank, brokerage, and retirement accounts (including account numbers and online user names and passwords, if applicable); real estate holdings
  • Legal information: Wills, durable powers of attorney, advance health care directives
  • Medical information: Health care providers, medication, medical history
  • Insurance information: Policy numbers, company names
  • Advisor information: Names and phone numbers of any professional service providers
  • Location of other important records: Social Security cards, home and vehicle records, outstanding loan documents, past tax returns
  • Funeral and burial plans: Prepayment information, final wishes

If your parents keep some or all of these items in a safe deposit box or home safe, make sure you can gain access. It's also a good idea to make copies of all the documents you've gathered and keep them in a safe place. This is especially important if you live far away, because you'll want the information readily available in the event of an emergency.

Don't be afraid to get support and ask for advice

If you're feeling overwhelmed with the task of handling your parents' finances, don't be afraid to seek out support and advice. Consider discussing the specifics of your situation with a professional, such as a geriatric care manager, an estate planning attorney, accountant, and/or financial advisor.

Remember that if you are an Optimum customer, you are entitled to the services of our Personal Bankers, who are members of the CNB Financial Planning Team. Feel free to contact any one of us for guidance in this area. Also, it’s good practice to have children and parents meet with financial planners jointly, to ensure that all needs are being met and that everyone is on the same page.

Source: ©2017 Broadridge Investor Communication Solutions, Inc. This material provided by Margaret M. Whelehan.

Investments are not bank deposits, are not obligations of, or guaranteed by Canandaigua National Bank & Trust, and are not FDIC insured. Investments are subject to investment risks, including possible loss of principal amount invested.