Financial Literacy for Seniors – Ways to Save for the Golden Years

By Brenda Enright
Owner of Home Instead Newmarket and Aurora

After a lifetime of hard work and financial responsibility, seniors deserve to enjoy their retirement without fretting over their finances. There are several expenses that come up throughout their lifetime—their golden years are no different. However, your aging parents may not know how to manage their money as efficiently as they used to. Ensuring a happy retirement requires their understanding of how to effectively manage, save, and safeguard their finances.

With the right financial knowledge and skills, seniors can confidently navigate their finances and truly make the most of their retirement. In this article, we will explore the crucial aspects of financial literacy for the elderly, from savings strategies to avoiding financial abuse. 

Home Instead cannot offer financial guidance, but we can offer additional services to enhance the quality of life for aging adults.

Building Financial Literacy for a Safe, Secure Retirement

Our elder years are a new adventure full of excitement, curiosity, and uncertainty. While it may be challenging to see clearly what lies ahead, one thing is certain, it is best to be prepared. As your senior enters their golden years, understanding how to manage their finances becomes incredibly important. By giving them the knowledge and skills to manage their money wisely, you're setting them up to enjoy the financial independence they need to live their best life. It also brings peace of mind to your family, knowing that your loved ones are financially capable as they enter their next stage of life.

Saving Tips that Make Sense for Seniors

It may be hard to anticipate and determine the exact figure for retirement funds that your aging parents will need for a comfortable and fulfilling life as a senior. However, through careful consideration and planning, they can adjust their savings goals early so their nest egg can accommodate future needs.

 Here are some valuable tips that can maximize your senior's saving potential.

• Create and follow a budget: As we age, it is natural for more dispensable income to become available. Creating a budget can help your senior visualize their monthly expenses and be able to properly allocate these funds to their savings account and investment of choice.
• Negotiate with current providers: A great way to unlock savings is by contacting their current insurance, phone, internet, and TV service providers to update or bundle their current plans. If you cannot successfully cut costs this way, you can always shop around for better deals elsewhere.</li >
• Review credit card statements: Monthly subscriptions and recurring payments are a large drain on finances that are often overlooked. It may be likely that they are paying for products or subscriptions they no longer use.
• Seek government benefits: Encourage your parents to apply for provincial and federal government benefits that they may be eligible for. Depending on their circumstances, they may be eligible for prescription drug coverage, seniors co-pay plans, free vaccinations, or income supplementation.
• Utilize senior discounts: Even if it is not explicitly advertised, it's always helpful to ask if there are seniors' discounts available when making purchases. Your parents can also consider becoming members of The Canadian Association of Retired Persons (C.A.R.P.) to receive discounts from a variety of merchants, shops, and services.

Is Your Senior Showing Signs of Aging that Puts them at Risk?

Aging can be an exciting new journey. But it can also come with a variety of challenges in the physical and mental aspects of your senior's livelihood. Physical and cognitive abilities can diminish, causing issues that impact their quality of life. Managing finances can be extremely difficult in these situations and can cause issues such as missed bills, financial mistakes, and scams.

It is important to recognize the signs of aging, which may include memory loss, impaired judgment, and loss of motor skills. If your parent is suffering from these symptoms, it may be necessary to appoint a power of attorney to make financial decisions on their behalf.
As your aging parents abilities decline, it is vital to take the necessary steps to help them manage their finances. The first step to managing your seniors finances is simplifying everything. This means you may have to keep everything organized and easily accessible. But it also includes tasks such as, automating bill pay, consolidating accounts, and creating a budget that can accommodate their lifestyle.

Financial Wellness & Debt Management Strategies for Seniors

Seniors who carry heavy debt into retirement are susceptible to rising interest rates that can increase their debt payments and leave them financially vulnerable in the future. If your senior is planning to live on a fixed income, it is important for them to manage and reduce their debt as soon as they can.

The following strategies can help your loved ones pay off their mortgages, credit cards, and other lines of credit:

• Budget wisely – Analyze your parents' budget to determine where to allocate their funds. Creating a budgeting plan can help them pay off their debts quicker.
• Prioritize expensive debt – Determine which loans have the highest interest rates and focus on paying those off first. Credit cards and variable interest loans are most commonly the forms of debt with the highest rates.
• Consider debt consolidation – In many cases, receiving a consolidation loan can save your parents money by lowering their interest rate. It also makes it easier for them to manage and track the progress of their repayment.
• Talk to your bank – If your senior is struggling to make payments, talk to their bank. They may be willing to work with you to provide alternative arrangements that can make repayment easier.

How to Protect Seniors from Financial Abuse and Fraud

From telemarketers promising cash prizes to fraudulent emails impersonating the government, the methods used by scammers are diverse and constantly evolving. Unfortunately, our elderly population are the most vulnerable to these types of tactics and are often the most targeted. In order to protect their money, it is important for your parents to know how to protect themselves.
The following tips can help them safeguard their finances and ensure they don't fall victim to financial abuse or fraud.

• Never send private information: It is easy for scammers to create emails that look like they come from a trusted source. Remind your seniors never to send anyone money or their personal information through email.
• Watch out for phishing scams: Scammers will often send emails that link to spoof websites. If you click on them, they can steal your personal information. Remind mom and dad - don't click on suspicious links, instead verify the email's validity with your institution by phone!
• Be suspicious of unknown phone calls: Phone calls that ask for personal or banking information must not be entertained, even if the caller seems trustworthy. If you suspect a fraudulent caller, try to ask a lot of questions that only that ‘genuine' person would know, as this will often reveal holes in the scammer's story.
• Hire a financial advisor: Investment scams and get-rich-quick schemes are becoming increasingly complex and difficult to spot. Having your parents' money invested with a financial advisor is the best way to ensure that they don't fall prey to fraudulent investment opportunities.

How to Make Taxes Simple for Seniors

Taxes can be difficult to understand at any age. But with maturity, come new rules and tax breaks that your elderly parent may want to take advantage of. The most important factor in ensuring that your aging parents are ready for tax season is organization. With documents such as retirement income statements, pension statements, T4 slips, and more, it can be easy to misplace important papers. Trained and experienced in-home care providers can help your parents keep their important documents in one place.

While organization is important, it is also key to be aware of the tax credits your senior may be eligible for. In Canada, there are several tax credits designed for seniors, such as the Age Amount tax credit, Pension Income tax credit, and Disability tax credit. These tax credits can help reduce your parents' tax burden and increase their disposable income.

Enlist Personal Care Assistance for your Seniors with Home Instead

As we age, keeping track of everything can be difficult. Luckily, your senior doesn't have to struggle with these challenges alone. Home Instead Newmarket, Aurora has an able team of caregivers and personal support workers to help your senior find a place for everything. We provide highly trained senior care professionals that specialize in personal care, companionship, senior safety, cooking healthy meals, Alzheimer's care, and more. Let's connect with your family to find the best services that work for everyone. Contact us to learn more.

Call us at (905) 235-7130 to schedule a no-obligation, in-home consultation. Learn more about the compassionate, quality senior care we deliver every day to families in Newmarket, Aurora, Baldwin, Beaverton, Bradford, Bradford West Gwillimbury, Cannington Brock, Ceder Valley, East Gwillimbury, Georgina, Holland Landing, Jacksons Point, Keswick, Kettleby, King, Leaskdale, Mt Albert, Pefferlaw, Queensville, River Drive Park, Sanford, Sharon, Stouffville, Sunderland, Sutton West, Udora, Whitchurch-Stouffville, Willow Beach, Zephyr.