Question

"My mother is 80 years old and is still managing her finances. She has quite a bit of money, and I worry about her being taken advantage of by unscrupulous individuals. I have read that older people are less alert to potential scams, and I do not want my mother hurt or her money taken. How do I talk about this with Mom while maintaining a good relationship with her?" - READER
 

Answer

This is a common situation. We spend most of our lives as adults managing our own affairs, including our finances. Your mother is not unusual for managing her own money. The important thing is to honestly consider how cognitively capable she is to make important financial decisions.

A certain percentage of the elderly will, indeed, become unable to manage money and other affairs as they age. One estimate is that 10% of the population will develop dementia. Some will have difficulty seeing, writing, and being physically unable to manage the work of handling finances. It does not sound like your mother is in that place at this time.

Helping her protect her assets for her future needs is a good idea. You are wondering how to have that conversation without barging into her finances and acting like a money-grabbing child.

The first thing you – or any adult child – must do in this situation is to be responsible with your own money. Pay your bills, invest wisely, have a steady incoming cash flow (a job, assets, etc.) and demonstrate to your mother that you are someone worth listening to. If you have not been able to function in this way, do not expect your mother to have any faith in your motives. She may be a lot safer left to her own devices if her children have not been responsible with money.

Now, if you have been a responsible money manager, your mother will likely know that. Talk with her about your investments and strategy. Ask her about her investing strategy and thoughts on the market. This is going to be difficult if you have never had this type of dialog with your mother before. So tread lightly at first. Ask her simple questions, like what rate of return she is getting and what has worked best for her over the years. Start the dialogue.

It is best to include siblings in your strategy with Mother if you have them. I do recommend an independent financial adviser for an introductory assessment. That is someone who does not sell anything, just gives advice.

You can become a strong partner for your mother in her investment strategy, and it is good to start the conversation.

I wish you success on your journey with Mom.