Do you have a parent or other elderly relative who may soon need a caregiver? If so, be diligent when selecting the right person for the job — because choosing the wrong one could lead to big financial problems.
You might find a close family member or friend to serve as caregiver — someone who is honest and trustworthy, with good judgment and strong money management skills. However, in many cases, people hiring caregivers just don’t know how they’ll perform until the caregivers have begun work. A dishonest caregiver could steal valuables or cash from the person they have been paid to assist or incept their mail to obtain credit card numbers and other sensitive information to commit identity theft.
So, if you enlist a caregiver and begin having doubts about them, you’ll need to watch out for these warning signs of possible financial abuse: Efforts to prevent the individual receiving care from speaking to family members Inquiries into the location of estate-planning documents, such as a will Interest in brokerage and retirement accounts, possibly with the intent to change transfer-on-death designations Withholding financial or medical information from the family Missing jewelry or property Requests to be a joint holder on bank or brokerage accounts, sometimes followed by large cash withdrawals paid to the caregiver Request for legal authority, such as a financial power of attorney naming only the caregiver This last item — the request for financial power of attorney, or POA — is particularly concerning because of the scope of duties covered by this type of authority. That’s why it’s so important that all family members understand what a financial POA can and cannot do.
