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Published on: 04/21/2023 • 5 min read

How To Protect Assets for Your Aging Parents

Wondering how to protect assets for your aging parents? It’s a difficult topic to discuss, but as our parents age, they become more vulnerable to financial exploitation and might need help from family members to ensure their financial security. Watching your parents get older is hard, but it’s even harder to watch them fall victim to fraud. 

The high-net-worth-wealth management professionals at Avidian Wealth Solutions are here to discuss how you can better safeguard the assets of your parents, identify potential threats, and openly discuss these sensitive matters with the ones who raised you.

Discussing the topic of money with your parents might be a hard thing to do, but by doing the work of protecting their assets now, you can help your parents maintain both financial independence and peace of mind throughout their golden years. 

Warning signs that your parents’ assets might need protection

The older your parents get, the more they will be targeted by various forms of financial exploitation. These things happen all the time, but there are warning signs that might help you stop things before they’ve gone too far. 

Some of the warning signs that your parents might be easy targets for fraud include if they:

  • Have trouble checking their bank account
  • Have trouble paying bills
  • Have trouble making purchases either online or in person
  • Let payable bills pile up
  • Don’t remember making purchases
  • Are unable to account for money

Elderly parents making poor financial decisions will likely not want to talk to you about these things. Being sensitive to the embarrassment that they might be feeling surrounding these issues is really the first step to protecting their assets, and knowing how to discuss these things with them might be the difference between failure and success. 

How to talk about finances with your elderly parents

If you want to successfully protect the assets of your aging parents, you’re going to need to broach the subject carefully. Here are some tips:

  1. Choose the right time and place, but don’t wait. Make sure that you have the conversation in private, in a place where your parents feel comfortable. Try to start this conversation soon after you become concerned about their financial situation. 
  2. Ease into your concerns. Don’t start off by accusing them. Begin talking about finances practically, by discussing budgeting, savings, or retirement in general before bringing up your concerns or discussing your proposed solutions. 
  3. Be sensitive and respectful. Your parents might feel like their independence is being infringed upon. Assure them that you’re concerned about their well-being and that the decision is up to them.
  4. Have a professional ready to step in. Your parents might be more likely to listen to a professional. Especially if you’re interested in setting up an estate or an asset protection trust, the know-how of a financial professional can help significantly in facilitating the conversation. 

You should also let them know that fraudulent scams are becoming more prevalent than ever, and encourage them to give you a call before giving out any personal information if someone reaches out to them online.

How can I financially protect my elderly parents?

If you’re wondering how to protect your elderly parent’s assets, you should ask yourself “how do the wealthy protect their assets in general?” The answer to your parents’ needs for asset protection probably lies in one of these common asset protection strategies. Although, there are some key differences between protecting your parents’ assets from fraudsters and protecting your own assets from a lawsuit. 

Monitor accounts and credit reports

Keep a watchful eye on your parent’s financial documents, whether those be bank statements or credit card statements showing large purchases or unauthorized activity, credit reports showing suspicious activity in credit score, or unauthorized accounts being opened in your parents’ names. 

Monitoring these activities can take up a lot of time and energy and is generally more reactive than it is proactive. Although monitoring for ongoing fraud is an important step in protecting the assets of your aging parents, there are more proactive steps that you can take. 

Set up an asset protection trust

What is the best way to protect an elderly parent’s assets? An asset protection trust is one of the most powerful tools available in the fight to protect assets from anyone trying to get their hands on them. 

Asset protection trusts are irrevocable trusts, which means they cannot be touched without the express permission of the trust’s beneficiary. You can set up a family asset protection trust to shield assets from fraud, overzealous creditors, and even estate taxes. 

Texas is one of many states that does not allow domestic asset protection trusts, which means high-net-worth individuals may need to take some of their assets to a foreign (or offshore) protection trust for safekeeping. This generally means even more privacy, although they can be a bit more expensive. 

Read more about the inheritance tax in Texas.

Set up a comprehensive estate plan

A comprehensive estate plan is the best way to ensure that wealth passes through your family as intended, structuring all aspects of your parent’s wealth to not only protect their assets from fraud but also to reduce their tax liability. 

If your aging parents do not have an estate plan in place, how can they be sure that their assets will be distributed according to their wishes? That their loved ones will be provided for? That creditors and unrealized tax advantages will not decimate their family’s plans for the future?

The process of passing on generational wealth is a complex one, but one that can be simplified for your parents by working with experienced estate planners whose mission is to make sure that their wishes are carried out. 

Help protect your family’s future by setting up an estate plan with Avidian Wealth Solutions

Knowing how to protect assets for your aging parents is about knowing how to talk to them and knowing when to bring in professional help. Monitoring your parent’s credit card statements will only get you so far. If you want to set up a foreign asset protection trust or draft a comprehensive estate plan, you’ll likely need some help from financial professionals that you can trust. 

The fiduciary financial advisors at Avidian Wealth Solutions are here to help. Whether you’re looking for financial planning and estate planning, or simply need guidance on deploying high-net-worth tax strategies, you’ll want to talk to the team of multidisciplinary professionals at Avidian Wealth Solutions. Schedule a consultation with Avidian today to discuss your financial future and all its possibilities.

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