The Importance Of Regularly Reviewing Your (and your loved one’s) Finances

Budgeting, keeping track of automatic payments, watching out for abnormal withdrawals. All this, and more when it comes to managing finances.
regularly reviewing finances

It seems like we learned a lot of things in school that are no longer used in daily life:

  • Writing in cursive.
  • Using the Dewey Decimal System.
  • Long division.
  • How to navigate the Encyclopedia Britannica.
  • Balancing a Checkbook.

Many of the time engulfing tasks that we had to do in our youth are now handled quickly, or even automatically, by computers, phones, or otherwise. But one item that we should still be spending time on, albeit in a different format, is that last item – balancing a checkbook.

Managing your finances continues to be of utmost importance today. In fact, it may be even more important than it was 30 years ago as automated technology has made us a bit careless when it comes to paying attention to our budgets, being sure we aren’t overpaying for services, and double checking that nothing out of the ordinary is happening with our bank accounts and credit cards.

Budgets Are Your Friend

If you aren’t budgeting your money, and helping your aging parents budget their money, you’re being foolish.

We all do it. We pretty much know our monthly expenses – mortgages or rent, car payments, typical grocery spending, a few extra dollars for entertainment – and we know how much money we’re earning each month or how much is coming in through a pension or social security. But we forget to think about the bigger picture.

If you’re a relatively young adult, think about the expenses that will arise when you have children. Consider the extra mouths to feed, the cost of clothing, the cost of schooling (which can be ENORMOUS).

And, if you’re a middle aged adult, thinking, “whew! I’m glad that’s over and my kids are out of the house,” trying to plan out some epic vacations with that extra cash, don’t forget that you won’t want to be working forever. Budgeting for retirement as early as possible will help you out in the long run, allowing you to enjoy a long retirement alongside your family.

And finally, for those older adults who are retired and living out their golden years, perhaps at a retirement community or aging with some help at an assisted living facility, it’s crucial to keep an eye on spending to be sure you can live out the rest of your life with minimal stress.

As most of us use online banking at this point, and likely have automatic payments set up for credit card bills, utilities, and more, we often forget to look at what’s really happening in our bank accounts on a regular basis. Is the money going up in your savings account? Staying about the same? Going down? What is your goal? How much money do you need by the time you are XX age?

Funny thing is, while the concern is that we become overly reliant on technology and that’s what gets us into this mess to begin with, technology can also be a solution. There are plenty of great apps that will help you budget your money.

one important factor in managing finances is being able to budget properly for retirement

One of our favorites is YNAB (You Need A Budget). We appreciate this app as it is a zero-based budgeting platform, which essentially means it forces you to make a plan for every penny that you earn. This might mean money that gets spent for specific items each month and it might mean money that is saved for specific things in the future. It’s a great way to look at your life holistically and make a plan that works.

Another favorite is actually one of the bigger apps – Mint. This is a great program as it will connect with your banking and credit card accounts and pull in data allowing you to quickly understand what you’re spending money on and help you reallocate your spending to be a bit more in line with your life goals. You’ll easily see if you’re spending too much on restaurants or if you need to start saving a bit more in order to reach retirement goals. On top of that, Mint can help out with some fraud alerts, which is definitely a nice bonus!

Double Check Your Automatic Payments

Double checking your, and your parents’, accounts on a monthly basis to be sure that you don’t have any extraneous recurring payments is essential. It’s pretty amazing how much money you can save when you realize that you’ve been automatically paying for a service that you don’t even use and all it takes is a quick review of your banking statement or credit card bill at the end of the month. 

Recurring payments are great. They keep you from missing a bill and incurring late fees. They take the stress away from the pile of bills that get stacked on the kitchen bench. But it’s critical to double check all of these automatic payments on a regular basis to be sure you are cancelling services that aren’t in use and that computers aren’t making an error and double charging or over charging. It’s rare that computers mess up, but it still happens.

In addition to looking at your normal recurring payments, be wary of any payments that don’t make sense. Maybe they have a weird name next to them on your bill or just a series of letters and numbers. Scammers love to get you looped into monthly payments as they know that once they’ve got someone on the hook, it’s pretty rare that they’ll check their account until they’ve paid out hundreds, if not thousands in automatic payments. This can be particularly true when it comes to those who prey on older adults.

Be Aware Of Abnormal Withdrawals and Charges

Speaking of scammers and fraud… even if you shrug your shoulders at budgeting and want to live with blind trust of your automatic payments, you should 100% be looking at your accounts on a regular basis just to be sure there are no fraudulent charges.

Yes, every major bank has fraud checks in place. If your credit card gets stolen, there is a high likelihood that the AI technology that banks use will spot that fraud immediately and alert you.

But, and it’s a BIG BUT, technology is never as good as humans when it comes to spotting fraud and exploitation. Even if you missed it up front and a scammer got you to pay for something, you can still spot it the second time around as long as you are paying attention.

Check your statement for anything that seems odd, even if it’s just for a couple of dollars. Sometimes scammers will test a small purchase with your information to see if anyone is paying attention. They’ll charge $2 at a Walmart just to see if it gets flagged. If you aren’t paying attention and the bank’s technology fails, they’ll dive in for a lot more money next month. 

Look out for charges that are based out of the country. Look out for charges that are listed to company names that you don’t recognize. Look out for recurring charges that don’t seem quite right. 

The key here is that it really just takes 5 or 10 minutes each month to scan through your statements to be sure there are no anomalies. If you find nothing, great. But if you do notice an issue, you can make it right.

Connect on WayWiser’s Financial Product

The easiest way to create a moat around your parents as they age, protecting them from financial scams and exploitation, is to sign up for WayWiser’s financial protection product. This tool gives you insight into their financial accounts, allows you to set up custom alerts to notify you and your Trusted Circle about suspicious transactions or withdrawals, and provides a format to share and discuss any unusual issues with your family so that you can resolve as a team.

You can get on the waitlist for these tools on WayWiser’s website here.

Consider Working With A Financial Advisor or Trusted Family Member

working with a financial manager or a trusted family member can keep you safe from fraud

Finally, you might want to consider adding a bit of help to your financial management. Afterall, as mentioned above, nothing is better than planning your finances and looking out for fraud than a human…well, nothing other than a team of humans!

The idea of a financial advisor or manager can be a bit daunting. Isn’t that just for the rich? 

No. In fact, most financial managers charge you based on how much money they are actually managing and can actually make you money in the long run if they are good at what they’re doing. Even if you aren’t sitting on millions of dollars in your bank account, it can be wise to look into hiring a professional financial advisor.

Additionally, or in place of a financial advisor, you should look to your family for help and protection. Being in regular contact with family and friends is proven to help protect people from fraud and exploitation.

Sharing finances with your adult children can feel a bit odd. It’s something that we tend to keep rather private. But once we become more comfortable with sharing this information with our trusted circle of family or close friends, the sooner we set ourselves up for success. 

Think of it a bit like your job. If you have a team around you, they can help with checks and balances. You can hold each other accountable for silly mistakes or mismanaged assets. Plus it never hurts to stay close knit with your family.

You can start sharing information today by get started on WayWiser.

Have another question? Ask an expert.

Our team is here for you. If you have a question about caring for an older adult or other member of your family—be it physical, legal, medical, financial, or anything in between—we’ll have one of our Trusted Advisors get back to you ASAP.

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