Financial planning for solo agers

Last week my husband and I joined a Zoom call with my mother and her financial advisor. It was an annual call to go over my mom’s needs and goals in the coming year. My husband and I are my mother’s partners in her financial decisions.

Up until five years before his death, my father handled their household financial affairs. It was at that time that my mother asked for some help. We chose the financial advisor my sister uses. Since then, the advisor has invested my mother’s money and managed her Required Minimum Distributions.

This is but one part of a much larger set of financial choices and actions my mother must take, but according to her, it was the one she was least equipped to handle.

As an almost 90-year-old single woman, she still has a lot of responsibilities.

For example, the advisor asked her if she had any large expenses coming up. She let him know that she lives in an age 65+ community and they plan to repave the roads and driveways next year. There will be a special assessment and her portion will be around $5,000.

He asked her if she had any concerns and she noted, “outliving my money.” He asked her how old she thought she would live to. Kind of a stupid question in my book, but she said maybe a few more years. He then told her that she had “plenty of money” and “to go spend it.”

Working in my field, I see many older adults challenged by healthcare or personal care expenses in their later years. A dementia diagnosis, for example, may lead to placement in a memory care facility at a cost of over $120,000 a year. I explained to the advisor that my mother was being prudent with her money so that her children would not need to incur the cost of her care should she need something like this.

He then rethought his response and said, yes, if she needed to cover costs like that, spending prudently made sense. My mother’s New England common sense ethics were working in her favor.

He asked my mother how much she had in her checking account and suggested spreading her money to a few savings accounts in online banks to increase her interest rate. We calculated the interest she could earn on the money she keeps in the bank, and it came to less than $1,000.

My mom and I talked about this after the call. At this point in her life, it does not make a lot of sense for her to move her money to multiple banks requiring her to use online banking to access her funds. There is a convenience and familiarity factor with her being able to walk into a branch of her bank and work with a human being.

My mother handles many of her other financial affairs – bill paying, signing up for her Medicare plan each year, and keeping her financial documents organized. And while my husband prepares her taxes, she collects all the documents and mails them to him each year.

Several years ago, we purchased a fireproof, waterproof lock box for her important documents like the deed to her house, insurance policies, and trust. On one of my visits home each year we go through the box to ensure we are up to speed with all that is in there and see if we need to include any new items.

It is easy to see that if someone is aging alone without the benefit of trusted adult children, a financial advisor or someone to do their taxes; properly managing one’s finances can be overwhelming.

To that end, Senior Concerns will be hosting the next in its Solo Aging series for women at their office on Thursday February 15, 2024 from 3-4:30. Registration for the seminar is required and can be made at here

Shortly after the in-person seminar, Senior Concerns will be placing a recorded seminar with the same content on its website. Check back at the same link after February 20th for the recorded version.

Good financial health enables choice and helps preserve independence. Taking steps today to ensure financial well-being in the future should be on all our minds.


Categories: Elder FinanceNumber of views: 125

Tags: elder financial planning

Andrea GallagherAndrea Gallagher

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