Financial elder abuse is an often poorly understood concept. One can only hope that financial advisors and journalists know what it means. Like everyone who suspects elder abuse, they need to call it out and to prevent it.
However, an article in the financial pages one day recently made me choke on my muesli.
A financial adviser wrote about some of the ways middle-aged children could protect ‘their’ inheritance. My elder-abuse-antenna shot up. Such ageist, abusive nonsense. Parents’ wealth belongs to the parents, and children have no rights to it.
Before I retired from paid employment, I worked as the chief executive officer of Advocare, an agency which advocates on behalf of older people. Much of the work of Advocare concerns various forms of elder abuse.
Financial elder abuse
Statistics show that financial abuse of older women and men occurs regularly in Australia and elsewhere.
The statistics form the tip of a very large iceberg, because few people willingly report elder abuse, even when they understand it. As well, many older victims do not want to deal with their family problems in a public forum.
Relatively few older people recognise that they can be victims at the hands of those they should be able to trust.
Most of us understand that strangers could harm us, financially and in other ways. It is shocking to think that our own sons and daughters, step-children, grandchildren, other relatives or friends would harm us.
Sometimes financial elder abuse occurs intentionally, but occasionally ignorance, not intent, drives the abuse. The perpetrators may not fully understand the possible or probable consequences of their actions. Older people may feel vulnerable. They may think their children know what is in their best interests.
The damage in any case devastates the older person, because no one wants to think of themseves as a victim of elder abuse.
To prevent financial elder abuse, people should obtain and maintain control of their own financial affairs. This applies even when a person is part of a couple.
Often, one partner deals exclusively with shared financial matters and makes the decisions. If that person dies or becomes incapacitated, the survivor could be left unable to manage for themselves. They become vulnerable. Decision-making could be taken out of the hands of the survivor, sometimes with ill-effect.
Powers of Attorney
The article I read suggested that the children should set in place Enduring Powers of Attorney for their elderly parents. Then, when the younger people need to make plans to care for the seniors, the children would have control over the parents’ finances.
Everyone should arrange to give their Enduring Powers of Attorney to someone they trust. No one knows if or when they might suffer injury or illness which would mean they might need someone else to take care of their finances. In the same way everyone, not just seniors, should make a will.
Most newsagents and Australia Post shops sell blank powers of attorney documents for a few dollars. Solicitors can also assist with putting these powers in place. The documents require the signature of the person donating the powers and those of two witnesses.
Enduring powers of attorney provide some legal protection against the possibility of financial abuse or exploitation. Catastrophic accidents, the onset of dementia or other unfortunate events can impair a person’s decision-making process. Who gets to look after our finances if we are not able should not be left to chance.
Contrary to the advice in the article, no one should allow anyone else to decide who will have these powers. Everyone should decide about their own future.
Sons and daughters can of course suggest that their parents put Powers of Attorney in place. But the idea of the children attempting to do it suggests coercion or even potential elder abuse.
I worry when I read articles such as the one in the newspaper. Such misleading information suggests that adult children can assume rights over their parent’s money or property. Not so! No child should expect to be given access to their parents’ funds or financial decision-making without proper processes in place.
Click here for another of my posts about elder abuse, and twelve steps to prevent elder abuse happening to you.
If you or someone you know suspects they may need advice about elder abuse, you can contact Advocare on 08 9479 7566 or the WA Elder Abuse Helpline on 1300 724 679.