How to handle the finances when a loved one can’t

Managing a household’s financial matters is an important task that is frequently completed by one partner. If that person develops a life-limiting illness, the other partner must often take over that task. This can create additional pressure when they have also taken on the role of caregiving. 

How to handle the finances when a loved one can’t

Managing a household’s financial matters is an important task that is frequently completed by one partner. If that person develops a life-limiting illness, the other partner must often take over that task. This can create additional pressure when they have also taken on the role of caregiving. 

Violet Guide Marian York, who worked in palliative care for 14 years, says this scenario is all too common. “I’ve repeatedly seen cases where caregivers have had to take over the financial affairs, in addition to caring for the loved one who used to manage these things,” she says.

Taking over finances can add to the stress of caring

As an example, Marian says she recently spoke with a woman who had to start managing the finances after placing her husband into care. “On top of that stress, she has to pay $100 a day over and above what the facility takes from his pension. She was struggling with that and didn't know what to do.

“She needed to get a loan to pay the additional care costs, which involved a huge amount of paperwork. Adding to the difficulty, she doesn’t access a computer, so had to run around physically to pick up and drop off forms. This has to be fitted in around visits to the facility,” Marian explains.

“I suggested she saw the financial advisor at Centrelink, which she hadn’t heard was an option. She was able to see somebody, and they were really helpful.”

Robert Lockhart, a Financial Educator from Westpac’s Davidson Institute, says other common issues they see when caregivers have to take over managing the finances include:

  • Needing to know the status of any debts.
  • Knowing whether or not they can act on their loved one’s behalf.
  • Finding out what options are available if their loved one is in care and not in a position to make financial decisions.
  • Knowing how to access bank accounts in the event their loved one passes away.

Where to get support

When trying to understand the current financial health of your loved one and how to budget for what’s ahead, Mr Lockhart recommends starting with speaking to your accountant or a financial counsellor. 

If you have power of attorney and are authorised to speak to your bank, you can check your financial status directly with them.

Marian has seen situations where people’s bank accounts get frozen when they die. She advises couples ensure both partners’ names are on the account as soon as you become aware one of you has a life-limiting illness, if not beforehand.

Another woman Marian knows experienced a difficult situation when her husband died and she kept receiving his mobile phone bills. “She rang the phone company to cancel the plan, and they said, ‘we need to speak to the person the phone is registered to’,” Marian explains. “She said, ‘but he's dead, you can't speak to him’. They said, ‘well, we can't do anything until we speak to the person the phone is registered with’.”

Mr Lockhart advises making sure you have power of attorney or authorised third party status so you can access your loved one’s accounts and act on their behalf.

Your general practitioner can refer you to a social worker for support with making financial decisions. You can also seek ongoing financial advice from a financial counsellor, accountant or solicitor, Mr Lockhart says.

Reduce financial stress with early planning

Marian adds that funerals can be expensive, ranging from approximately $2,000 for a direct cremation to upwards of $15,000 for a more lavish ceremony. “If you don't have that money, that's an issue,” she says. She recommends either organising a pre-paid funeral or putting some money aside to cover the type of funeral you’d prefer. She also advises everyone should have an up-to-date will, an enduring power of attorney, and an advance care plan/directive.

Mr Lockhart also suggests having an advance care plan/directive in place. “It’s something for the community to be aware of in case they want to make decisions while they can.”

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