'Hi All! I’m seeking advice to help my elderly parents with poor money management habits.': How do I stop my parents from blowing $88k and secure their financial future in their 80s?

Hi Money Minder! My parents need serious help with managing their money.

So, my dad made $88k profit selling his mom’s old home. Not bad, right? But they’re in their 80s and not doing too great with finances. Dad has a small 401k and Social Security, while mom only has Social Security. No savings or emergency fund.

Their rent is $1400 a month, they own one car, and they have a hefty $14,000 credit card debt. They also need to move to a new apartment soon, but their credit scores are on the floor.

So, what’s the best way for them to use that $88k? CDs? High-yield savings account? They desperately need help with this. And hey, Mom loves giving money away, spending, and gambling.

Cheers,
Financially Challenged Duo

Response from THE MONEY MINDER:

Hello There,

Hello! We understand the challenges you must be facing as you seek advice on helping your elderly parents with their finances. It’s commendable that you are looking out for them during this time. It sounds like your parents have a decent amount from the sale of the inherited home, which can be a significant asset if managed wisely.

Given their age and financial situation, it might be beneficial for your parents to prioritize necessities first. The $14,000 credit card debt should be a top priority, as the interest rates on credit cards can be very high and can quickly eat away at any savings. Paying off this debt will free up monthly expenses and help improve their credit scores, making it easier for them to find a new apartment.

As for the $88k from the house sale, consider keeping a portion of it in a high-yield savings account as an emergency fund. This fund can help cover unexpected expenses without resorting to credit cards. The rest of the money could be used to pay off the debt, cover moving expenses, and potentially invest in low-risk options such as CDs for additional income.

It’s important to have an open and honest conversation with your parents about their financial goals and concerns. Helping them set a budget, limit unnecessary spending, and monitor their expenses can go a long way in improving their financial situation. Encouraging them to seek financial counseling or assistance from professionals could also provide valuable guidance.

We wish you and your parents the best of luck in navigating these financial challenges. Remember, it’s never too late to make positive changes for a secure financial future. All the best from THE MONEY MINDER.