Elderly parents sometimes lose the ability to manage financial affairs. This situation requires children to step in to help with personal banking. When tax considerations make commingling money from both parent and child a problem, linking a bank account for use by the child, or children, offers a solution to help seniors manage independent living. This also protects elderly parents from financial predators. The AARP estimates phone scammers fraudulently take £26 billion each year from unsuspecting consumers, and 80 per cent of these victims are seniors. Securing funds using supervision by an elderly individual's children helps reduce this type of economic loss.
Draw up the paperwork providing legal rights to assist your elderly parent. This step provides an optional power of attorney or legal conservatorship over the parent's affairs. Talk with your family lawyer to determine if this step fits the needs of the situation, as other legal ramifications come with accepting this responsibility.
Collect personal identification documents. Opening a bank account requires official identification from both you and your elderly parent. Banks usually require photo identification for new accounts for customers unknown to the bank. A Social Security number, or federal identification, is also required for all account holders.
Shop banking institutions. Not all states or banking institutions allow this type of shared banking, so chat with the bank manager before signing any paperwork. Also shop the costs of account maintenance and operation to match available accounts with your personal needs and those of your elderly parent.
Present legal paperwork and identification to the bank to open an account. Certain banks may require both parties on the account to be present to open a new account. If bank officials know you and your parent, this formality might be waived by the bank manager.
Order checks or share drafts for the account and arrange for online or personal banking to pay bills or credit cards. Make sure you've set up access to the account in the manner best suited for your lifestyle and your elderly parent's needs. Determine the best party to monitor online banking, if used, and set up passwords and online security at the bank. Bring credit card numbers and contact information for all bills, regular payments and charges paid through the new bank account. Setting up an automatic account payment typically requires written or telephone approval from the account holder, so your parent must approve any payment changes with the credit card company, utility, landlord or home mortgage company. Also arrange for automatic deposit for Social Security, retirement or other income payments.
Banks make a quick personal credit check prior to opening new accounts. If you have poor credit history or issues with your own personal bank account, including a number of bounced checks, suggest another sibling or family member link his account with your parent.