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that possibility without looking into it. Be on guard for any sudden changes in investments that seem out of keeping with the loved one’ s longstanding goals, values and investment style. These changes may have come about because of confusion or may be a sign of financial exploitation.
If your family member or friend has named you to manage money or property.
Understand your responsibilities and how you can protect your loved one from financial exploitation.
For example, your loved one may have named you as an agent under a power of attorney or a trustee under a revocable living trust.
Read the Consumer Financial Protection Bureau’ s Managing Someone Else’ s Money( consumerfinance. gov / blog / managing-someone-elsesmoney). They walk you through your duties, tell you how to watch out for financial exploitation and scams, and tell you where you can go for help. tax returns, or helping with investment decisions.
Review their investment portfolio.
This might be a good time to help reevaluate the person’ s portfolio in light of his or her financial and medical situation. Does the person expect a big increase in health care, personal care or other costs as a result of his or her illness or disability? If so, will he or she have enough cash or liquid assets on hand to cover those costs?( Liquid investments are assets that the owner can sell readily and without paying a hefty fee to get money when it is needed.) These can be complex questions and you may wish to discuss them with a financial professional. Keep in mind that buying and selling investments on behalf of a loved one requires legal authority, through a power of attorney, a wish to consider contacting a registered investment adviser, representative or registered broker-dealer representative for help.
Contact their investment professional.
If your loved one has a financial professional and has authorized that person to speak with you, make the professional aware of your loved one’ s condition.
This is critical so that the financial professional can make recommendations appropriate to the client’ s financial needs and can watch for signs of declining financial skills or potential abuse.
Your financial professional, or that of your loved one, may raise topics discussed in this bulletin. Financial services firms are paying increasing attention to improving communications on this subject. If a financial professional does not raise these topics, however, you should feel free to raise them yourself.
If you have been asked by a loved one or friend to help out with his or her finances, here are some things you can do to help.
Help with ongoing financial responsibilities.
You may need to take on immediate tasks, such as helping to pay bills, arranging for benefit claims, preparing trust or similar arrangements.
Assess the riskiness of their investment portfolio.
All investments involve some level of risk. But do the investments present the right level of risk at this stage of the person’ s life? If not, you may
Spring 2018 15 The Credit Professional