Savvy Ladies is a not-for-profit organization formed to provide free financial mentoring to women.
How does it do this?
An army of volunteers, to start. Any woman can sign up for a pro bono 1 hour mentoring consultation with a Certified Financial Planner™ on a wide variety of topics. Volunteers have also written blog posts and recorded webinars on specialized topics. All are available on the organization’s website, https://www.savvyladies.org.
What kind of topics?
Cash flow, investing, divorce, widowhood, caregiving, budgeting, debt, college, careers and more.
Who does Savvy Ladies serve?
Any woman of any background who has a question about money. Founder Stacy Francis recognized that, as women, we are more often in-the-dark about money issues than men. Many women have no one to talk to about it. Savvy Ladies creates a safe place where those questions can be asked and answered.
What is its goal?
More self-reliant, financially educated women. In psychological terms, “financial self-efficacy.” Having self-efficacy means feeling confident and resourceful enough to handle a problem or question. Note this does not mean having or knowing all the answers. It means having the confidence to know where you might find the answers, and that you will be successful.
Who are the volunteers?
The website features several of the many volunteer professionals. Recently as a volunteer I have spoken with women as far away as Colorado and as close as my home state of Florida.
What’s the catch?
No catch. Volunteer professionals do not solicit for business. After the one hour consultation, the recipient fills out a survey asking how well their question was answered. The volunteer also fills out a survey asking how well they thought the consultation went.
Donate or Sponsor. Savvy Ladies relies on donations and sponsorships to keep the website, small staff, and operation running smoothly.
Refer. Refer a woman you know to the free financial helpline for a consultation. Or, refer a financial professional you know to volunteer.
Volunteer. If you are a financial professional, apply to be a Savvy Ladies volunteer. It’s up to you how much time you spend. Of course, men are welcome, too!
Parents, aging, and finances. Talking about aging with parents can be one of those difficult conversations we want to put off for another day. Like other difficult conversations, though, avoidance usually makes it harder.
Transitions in aging can fall into four broad categories: financial matters; health care decisions; living arrangements; and transportation. This week’s post tackles the topic of finances.
Helping Parents With Finances
The downside of the digital age is that it makes seniors more susceptible to fraud and scams. They can send or spend money anywhere, or divulge sensitive information, with one click. Without being physically present, adult children might not be as quick to catch the warning signs that a parent has become susceptible.
The most common kind of elder financial abuse occurs from people close to the parent. Sometimes it can be a new person in their lives – a girlfriend or boyfriend, a housekeeper, or a companion caregiver. Checking up on new friends and companions might not feel good, but is a necessary step.
Are parents located far away? In her wsj.com article, Veronica Dagher interviews financial advisors and aging experts on how to help parents with finances from a distance.
By volunteering to help with bill paying, the person with the DPOA can begin to get acquainted with the parent’s accounts, particularly what kind of expenses are normal and which are not.
Parents: Start Early, Small and Often
Parents would be wise to communicate early with adult children. While the topic of money is taboo in many households, it will make everyone’s life easier if the parent is open and communicative. It’s helpful to know how many accounts there are, how the accounts are managed, and approximate amounts or a range of amounts in each. Describe how the transition of help with money would go in an ideal world. Other steps:
Provide contact information for the financial advisor, investment manager, lawyer, and accountant.
Arrange an annual family meeting with any or all of the above.
Begin conversations early with small topics first. Allow everyone involved to grow into their roles.
Build on that trust to expand financial duties as time goes on.
Adult Children: Start Early, Small, and Often
For the adult children, instead of anticipating one future difficult conversation, experts recommend thinking of each topic as a continuous conversation to be had over a number of months or years. Following are some pointers.
Start the conversation with curiosity.
“Mom/Dad, if you should ever reach the point where you’re unable to (balance your checkbook, drive on the interstate, feel confident about a medical decision, feel comfortable living on your own), what would you like to have happen?”
“What would be an example of something that would indicate the point at which you would like help?”
Listen intently. Even if it is not what you would like, check for understanding by repeating back what you heard. For example, “So what I hear you saying is that, if you have a fall, that’s when you’ll ask for help. Is that true?” Sometimes when we hear things back, we change our minds, or clarify.
Things To Do Now
As noted in Dagher’s article, one of the most important documents is a Durable Power of Attorney (DPOA). If a DPOA is more than a few years old, or there has been a change in health status, have it reviewed by an elder law attorney. The attorney will make sure the powers granted are up to date with current law and broad enough for the parent’s current situation.
Since so much of our financial lives are online, it’s also wise for a parent to share emails, userids, and passwords with the person named as DPOA. Ideally, all of the financial institutions where a parent has accounts would have copies of the DPOA and confirm they recognize it as valid.
By volunteering to help with bill paying, the person with the DPOA can
begin to get acquainted with the parent’s accounts
become known to the institutions where accounts are held and
learn what kind of expenses are normal and which are not.
Additionally, it tends to work better if just one person is named as DPOA. Then name a backup or successor in case they are unavailable. Joint DPOAs can be a headache.
DPOA Does Not Work for Health Care
While the DPOA covers financial and legal matters, it does not address health care decisions. For those, a health care proxy or Designation of Health Care Surrogate is necessary. With Covid-19, family members may not be allowed in the hospital. Should an emergency happen, the health care proxy, as well as any living will, DNR (Do Not Resuscitate), or DNH (Do Not Hospitalize) documents should be provided to paramedics and/or hospital staff.
These are difficult scenarios to think about or talk about. The most important thing to do now is begin with a single step. Whether you are the parent of adult children, or the adult child of an aging parent, it’s never too early to broach the topic. Rather than waiting until it’s too late, start while it seems too soon. That kind of talk will be a lot easier.
A friend in her 30s is grieving a recent loss. She says she is very tired. Maybe she can’t sleep, and she has two kids. Yet I sense an expectation of herself to work as hard as she did before the loss. “I need to show up for work, and I can grieve when I get home later,” is an idea I remember having the first time I experienced intense grief.
In short, grief was a chore on my to-do list. As if.
4 Lessons
Since my first encounter with grief, and after meeting many people dealing with loss, I’ve learned 4 helpful things about it:
1) Grief is not optional.
It’s not something we can refuse, like dessert. “None for me right now, thanks anyway.” Nope. If you get hit by a 2 x 4, there will be an injury. How much it hurts, and for how long, depends on your pain tolerance, your physical fitness, or your size relative to the 2 x 4’s. Grief’s injury, unlike the 2 x 4’s, doesn’t manifest as throbbing pain, gushing blood, or even crying, for some people, so we might tend to think we willed it away. But the grieving brain still has an injury that needs a way to heal.
2) Grief affects judgment.
Absent-mindedness, like putting your cellphone in the refrigerator, is normal. So is making major decisions that are later filled with regret. Don’t push someone grieving to make a major decision, and don’t put yourself in that position if you can help it. If your widowed client wants to let the life insurance check sit in the bank account, let it sit for now.
3) It takes longer to heal than many of us think it should.
“Shouldn’t you be over this by now?” Don’t say this to yourself, and don’t think it about anyone else. The process is fluid, and change happens daily on the way to feeling consistently normal again. However, if the grieving process appears to be “stuck,” then talking to a mental health professional might be a good idea. (See https://www.caring.com/questions/grieving for signs of being stuck.)
4) Death is not the only cause of grief.
“It’s not like anybody died or anything.” Divorce and breakups, an empty nest, addiction problems, a major change in health, and relocating all can bring about the same sense of loss and emotional tornado of grief. Treat those events the same way. If they want to talk about it, be the best listener you can.
What Can We Do?
In addition, what helps healing?
1) Supportive groups, friends, or family. Talking about it.
2) Sensible diet and exercise. Injuries heal better with vitamins, nutrition, and endorphins.
If you’re the one grieving, it can be hard to pick up the phone, put on the sweats, break out the paints, or sit on the yoga mat. If you’re the one who wants to help, though, invite them to occasionally talk or walk with you.
Nevertheless, whether you’re hurting or helping, sharing the pain of grief leads to richer lifelong relationships.
For many families, the holidays are one of the few times when adult kids, parents, grandkids, and grandparents get to see each other. That time together might be the best time to have a planned “Visit.” There are two common topics for the Visit: 1) finances; and 2) health and home. Today’s post will deal with finances. Next week I will have a guest post from Monica Stynchula, LCSW and CEO of ReunionCare, about health and home.
Members of the Greatest Generation are notorious for keeping quiet about money. Yet, as they reach old age, their Baby Boomer kids begin to wonder, “Do Mom and Dad have enough money to live on?” “What if they need in-home care?” “What if they need to make modifications to their home?” “Did they really need those $5000 new windows, or are they being scammed and not know it?” “If I had to pay bills for them, where do they keep their money?” “What if they have money or accounts stashed somewhere and they forget about it?”
Some parents may discourage the money topic by cutting conversations about it short. Perhaps they do not want to acknowledge their own mortality. Perhaps they are embarrassed about falling victim to a scam already. Perhaps they see all of their kids as spendthrifts who will not be responsible (regardless of their age, education, and career status). Perhaps they are afraid of having the keys to their car, or their home, taken away. And it’s not always the parents that don’t want to talk about it. Sometimes the adult kids are uncomfortable talking about their parents’ mortality, and they are the ones cutting off the communication.
Regardless, every time the topic, and its underlying emotion, is avoided, it feeds an elephant in the living room. If not acknowledged, it stays there, and gets bigger, until a crisis erupts, and everyone is forced to talk about it under duress.
How do you bring up the money topic before a crisis? Try owning your discomfort about it up front. “There’s something I am struggling with talking to you about,” might be a good beginning, for example. Then let them know what you want to talk about: “There are two main concerns that keep coming up for me, and I need your help.” However, if they still shut down, keep your cool, and be empathetic: “If I were in your shoes, I would find this hard to talk about, too. Perhaps this wasn’t the best time to bring it up.” Try writing them a letter instead to keep the conversation going.
But, if you find the discussion goes even better than you thought, let them know how relieved you are: “Wow, I was so worried about talking to you about this, but I feel better now.” You may find you have paved the way for more open conversation, and even happier holidays with the family, in the future.
For many families, the holidays are one of the few times when adult kids, parents, grandkids, and grandparents get to see each other. That time together might be the best time to have a planned “Visit.” There are two common topics for the Visit: 1) finances; and 2) health and home. Today’s post will deal with finances. Next week I will have a guest post from Monica Stynchula, LCSW and CEO of ReunionCare, about health and home.
Members of the Greatest Generation are notorious for keeping quiet about money. Yet, as they reach old age, their Baby Boomer kids begin to wonder, “Do Mom and Dad have enough money to live on?” “What if they need in-home care?” “What if they need to make modifications to their home?” “Did they really need those $5000 new windows, or are they being scammed and not know it?” “If I had to pay bills for them, where do they keep their money?” “What if they have money or accounts stashed somewhere and they forget about it?”
Some parents may discourage the money topic by cutting conversations about it short. Perhaps they do not want to acknowledge their own mortality. Perhaps they are embarrassed about falling victim to a scam already. Perhaps they see all of their kids as spendthrifts who will not be responsible (regardless of their age, education, and career status). Perhaps they are afraid of having the keys to their car, or their home, taken away. And it’s not always the parents that don’t want to talk about it. Sometimes the adult kids are uncomfortable talking about their parents’ mortality, and they are the ones cutting off the communication.
Regardless, every time the topic, and its underlying emotion, is avoided, it feeds an elephant in the living room. If not acknowledged, it stays there, and gets bigger, until a crisis erupts, and everyone is forced to talk about it under duress.
How do you bring up the money topic before a crisis? Try owning your discomfort about it up front. “There’s something I am struggling with talking to you about,” might be a good beginning, for example. Then let them know what you want to talk about: “There are two main concerns that keep coming up for me, and I need your help.” However, if they still shut down, keep your cool, and be empathetic: “If I were in your shoes, I would find this hard to talk about, too. Perhaps this wasn’t the best time to bring it up.” Try writing them a letter instead to keep the conversation going.
But, if you find the discussion goes even better than you thought, let them know how relieved you are: “Wow, I was so worried about talking to you about this, but I feel better now.” You may find you have paved the way for more open conversation, and even happier holidays with the family, in the future.
3-Minute Video: Having “The Visit” At The Holidays
Members of the Greatest Generation are famous for their frugal habits, sometimes to the frustration of their Baby Boomer kids. It can be hard to understand why Mom or Dad refuse to part with Ziploc bags and empty shoeboxes, or why they will not buy something nice for themselves. Many of us recognize that these habits probably evolved after being raised in a time of true scarcity – the Great Depression. What I didn’t know until recently was how this money mentality was reinforced by our government throughout World War II. A baby boomer friend recently showed me a historic relic I had only read about but never seen: a war ration coupon book, issued in 1943. It belonged to his mother, born in 1928.
1943 War Ration Book – front
1943 War Ration Book – back
The language and tone on the ration book is striking. Authoritarian, even threatening. If you had been a young person holding this ration book, what money messages might you have received? My own thoughts, if it were me at that time, are below.
“Rationing is a vital part of your country’s war effort. Any attempt to violate the rules is an effort to deny someone his share and will create hardship and help the enemy.” (Yikes! Both of those sound pretty bad. I’ll comply.)
“This book is your Government’s assurance of your right to buy your fair share of certain goods made scarce by war. Price ceilings have been established for your protection. Dealers must post these prices conspicuously. Don’t pay more.” (Those evil dealers/merchants. They’re always trying to get us to pay more than what’s fair.)
“Be guided by the rule: ‘If you don’t need it, DON’T BUY IT.’ ” (Right! I got through the last ten years with one pair of shoes; the next pair can last that long, too.)
Contrast the last message to the one to “go shopping” following the 9/11 attacks. The word “ration” itself is used 9 times on the outside of the book, plus on every stamp in the book. Other scarcity terms pervade: “This book is valuable. Do not lose it.” “Without the stamps you will be unable to purchase those goods.” “Do not throw this book away…You may be required to present it…”
You may ask what self-respecting Americans would have put up with this rationing garbage. Yet, at the time, the government had been given credit for bringing us out of the Depression. We had been attacked by Japan, and German U-boats were off our coastlines. Who else would you turn to for protection? If you wanted “rationed goods,” (many of them household staples), the government was the provider, unless you wanted to risk a $10,000 fine (a lot of money now, and in 1943?), imprisonment, or both. Stiff penalties awaited noncompliant rule-breakers. From this place of fear, a message of scarcity to a Depression-battered generation must have seemed natural, even patriotic.
Money messages from authority make the most impact in our formative years, and in times of fear. It depends on who we view at the time as authority: parents, teachers, coaches, pulpits, and government. In response, we adapt the best habits we can in the interest of self-preservation. The trick is to continue to ask ourselves, as times change, are these habits still serving us well? Are they helping us lead a happy, fulfilling life, enhancing relationships with those around us? Or are they keeping us trapped by unhealthy attachment to money, possessions, or fear itself?
The best reason I ever heard for not seeing an estate planning attorney came from a late client who, upon learning that over half of his estate might be taxed, said, “I don’t mind. The government has a lot of good programs.” (I responded, “Ok. How can you be sure your money will go to the programs you like?”) I don’t believe, despite his political views, that he really wanted to leave half of his money to the government. I do believe it seemed better than addressing his mortality, though.
Talking and thinking about our own death is stressful, so it’s no wonder many people avoid it, deny it, and don’t want to deal with it.
But what if your reason is simply, “It’s too hard to decide”? No doubt about it, estate planning can involve gut-wrenching decisions, like choosing a potential guardian for your minor children. (Ugh.) Or figuring out what’s “equal” vs. what’s “fair.” Who to include and who to exclude? Which charities will handle a bequest most responsibly? Leave money in a lump sum, or spread it out over time? In-laws, multiple marriages, step-relatives, girlfriends, boyfriends….today’s families are complicated. Perhaps you and your spouse or partner disagree. Or you and your children do. The more you delay, the more the questions, and their unknown answers, multiply. You might want to brush it off, like my client, since you “won’t be around anyway to worry about it.” But until then, it can still eat at you.
A lot of people think they must make all the decisions before they go see the attorney. But when you think about it, estate planning attorneys deal with such decisions all the time. Many of them are actually pretty good at suggesting alternatives you might not have considered. Attorneys are more than just note-takers; they are advisers and advocates. The good ones are smart people who love to come up with creative solutions to legal questions. So when I hear someone can’t decide, I encourage them to make the appointment anyway. Addressing our mortality may not be pleasant, but it’s better than being eaten alive by indecision.
It always happens right before I head to the airport.
Butterflies in my stomach.
Little waves of nausea.
Tight chest.
I have to tell myself to breathe deep.
“Calm down.”
“It’s going to be ok.”
What am I so afraid of? Unlike many, I am not afraid of flying. I am afraid of missing the plane.
If I could translate into dollars, I would calculate that my time and mental energy equate to a very high insurance premium (three hours of time and life-shortening worry) for a highly unlikely event (I will be so late I will miss the plane).
It seems we are hard wired to worry about things beyond our control. I cannot control when the plane leaves. It is leaving with or without me. We cannot control when a teenage child wants to get their driver’s license. Nor when a parent turns 90 and wants to keep it. These are somewhat scheduled events that we can fairly expect to happen, no matter what.
Scarier yet are random events. Market meltdowns, tsunamis, cancer, dementia, elections, terrorists, bonds, hackers…have I got your heart rate up? Butterflies? Tight chest?
Breathe.
Remembering and accepting what we cannot control…wasn’t there a prayer about that? My flying experience shows I still have a ways to go putting the Serenity Prayer into practice. In the meantime, I have an irrational need to leave home at least two to three hours ahead, to get to the gate at least an hour before the flight, and, when I get there, to sit where I can see the gate agent and the boarding door.
But the most overdramatized things I hear about (such as the Fed is too loose, hyperinflation is inevitable, or the dollar is doomed) tend to come from advertising-hungry news sources. All of these worries I am able to a) discount and b) ignore.
How can you do the same with media-induced angst? Pay attention to those butterflies. When you feel them, try asking yourself:
a) Where are they coming from? And breathe.
b) Can you do anything about it? And breathe.
c) Who is the source? And breathe.
d) Does that source have an economic incentive to create some drama/worry? And breathe.
e) Give yourself a gold star for getting this far. Then, of course, don’t forget to breathe again.
If you are still worried, see a financial professional about what kind of costs – money, time, or energy – you are willing to pay to offload your perceived risk. Or, see a mental health professional about getting to the root of the worry – it might be stemming from something else. Do whatever you need to to find the serenity to accept what you cannot change, the courage to change what you can, and the wisdom to know the difference. Even if it’s only about your money.
And when you get there, let me know. I might need a ride to the airport.
Optimism bias. I would not label myself as “optimistic.” But I am not pessimistic, either. To me, “optimism” conjures up the chorus from the R.E.M. song: “Shiny, happy people holding hands.” Not the image of how I approach life. No, I do not believe things will get better and better, but I do not believe they will get worse and worse. I believe, like most human beings, that they will stay the same. This is one version of what behavior experts call “optimism bias.”
If it was sunny yesterday, it will be sunny today. If I am healthy today, I will be healthy tomorrow. In fact, I will be healthy forever. Ok, not forever, but for the foreseeable future. Well, ok, maybe not. But probably nothing will go wrong. I am 47 years old and in good shape.
In December I had my checkup. Everything was sailing along as the doctor checked my blood work. Normal, normal, normal. (Yeah, yeah, yeah, why do I even get physicals? I am normal and have been all my life. Things will stay the same.)
Then she paused. “Ok, Holly, so what we have here is an elevated….” (What? Wait, this sounds permanent. As in chronic, but not life-shortening. Great, I have to take a pill now.) Things will stay the same. Until they don’t.
At a symposium last Monday, I heard Dr. Lisa D’Ambrosio from MIT’s AgeLab describe her research on aging and driving. Imagine you live 200 miles away from your 81-year-old father. When you visit, a few things seem a little off. Maybe he shouldn’t be driving that clunker he loves so much. But you have to get back home. Surely things won’t get worse. And you won’t have to confront him. Things will stay the same.
Lately the Dow Jones Industrials have climbed to record highs. People are piling in. Stocks went up yesterday. They will go up tomorrow, right? Things will stay the same.
It is not possible to hedge against every unforeseen event. However, we can look at the stats on what events are more likely than others. You live in Florida on the water, you are more likely to have wind and flood damage. Both of your parents and their parents had cancer, you are more likely to have cancer. Afraid of flying? You are more likely to be killed on the way to the airport than on the flight. Have longevity in your family? Dementia is more likely to be part of your future.
One of the areas I receive the most resistance from is long term care insurance. I do not sell long term care insurance. I just try to get people over 50 to buy it if a $500,000 – $900,000 dent in their future net worth might impoverish them. It is difficult, though, to plunk down premiums of $4000-$6000 now for some unknown so far in the future. This is optimism bias at its worst. Once you begin to show small symptoms, it is too late. You cannot get coverage. Got a parent or spouse with optimism bias? Insurance coverage may not be the prettiest gift, but it may bring the most gratitude later.
For the middle stages of Alzheimer’s, when we can dress and bathe ourselves, but cannot be left alone, there is no caregiving coverage from Medicare nor Medicaid. Asking a family member to serve in this role is asking a lot.
Long term care insurers are the only outside source available for covering in-home caregivers, who will be in high demand by 2030. At $15 per hour, even twenty hours a week in the early stages adds up to $1200/month (in today’s dollars). The average life expectancy from diagnosis is eight to ten years. (See the website of the Alzheimer’s association: http://www.alz.org/alzheimers_disease_stages_of_alzheimers.asp for the seven stages of dementia). And insurers are getting more picky.
If you can’t imagine yourself needing a caregiver, a wheelchair, or even a daily pill, that’s human and that’s ok. Just think about the statistics, though, for those you love. Might it make sense to spend something now to avoid regret later? One thing I know: things stay the same, for a while, until they don’t.
For many families, especially those in Florida who move from elsewhere, the holidays are the only time every one or two years when adult kids, parents, grandkids, and grandparents get to see each other. That time together is ideal to let your family members know where you keep “the Notebook.”
The Notebook is my term for a central place you keep information “in case something happens to you.” I find many people have some kind of a notebook or desk drawer, but often have a few items missing.
What do you keep in your Notebook that you want your family members to know? Write me with your ideas at holly@hollydonaldsonfinancialplanner.com and I will compile them for a blog post and for the next newsletter. Let me know in your email if it is ok for me to use your name and your city.
Common and essential items in the notebook include:
* Your five basic estate planning documents: original will (drafted by an attorney in the state where you now reside), living will, health care surrogate, durable power of attorney, and HIPAA designations;
* Advanced estate planning documents if you have them: trusts, partnership agreements, business buy/sell agreements, shareholder agreements, etc.
* Insurance policies. ALL of them: life, long term care, health, property, car, boat, liability, and any others.
* Contact information for all professional advisers: attorneys, bankers, accountants, investment advisers, insurance agents, and of course your personal CFO or financial planner. 🙂
* For each adviser, make a note about what document or issue they helped you with.
* Also, if your adviser has an assistant or paralegal who knows you and your situation, write down their contact information and a little note to that effect. (“Sharon is the assistant and she runs the whole place.”).
* All of your health care providers – doctors, dentist, optometrist, veterinarian (who is going to take care of Fluffy?). Put similar information by each one – what they helped you with and if any office or nursing staff know you and your history.
* Directions on how to find your financial stuff: online user ids and passwords, bank statements, investment statements, real estate deeds and mortgages.
Not-as-essential items some people include:
* An “ethical will” outlining your values. When they are having trouble deciding what you would have wanted, they can refer to your ethical will for guidance. (www.yourethicalwill.com or www.personallegacyadvisors.com)
* An end-of-life health care management booklet like Five Wishes (http://www.agingwithdignity.org/forms/5wishes.PDF).
Think of your Notebook as a trail of bread crumbs to help your loved ones work backward in your footsteps. A investment of time to leave an easy-to-follow “trail” is one of the best holiday gifts you can give.
