My mom (67F) was recently diagnosed with early dementia and my dad (70M) has been “hands off” with money for years. My sibling (31F) and I (29M) started helping with bills and found out a bunch of stuff has been quietly spiraling.
She set up auto-pay on what feels like everything and then stopped checking statements. There are multiple subscriptions, a couple store cards with small minimum payments, and two different “protection plans” on appliances that don’t even exist anymore. On top of that, she hasn’t filed for a senior property tax exemption she qualified for, and the tax bill is now delinquent.
Here’s the current picture:
– House is owned, but property taxes are behind and there are penalty notices.
– Utilities are current but tight.
– Credit cards are near maxed with high interest.
– Checking is getting hit weekly by auto-debits.
– They have a modest emergency fund but it’s not huge.
We’re trying to stabilize without making things worse. What should we prioritize paying first: delinquent property taxes vs minimums on credit cards vs utilities? Also, what is the realistic timeline/consequences for not paying property taxes for a few months while we sort things out? Same question for credit cards.
We’re planning to cancel subscriptions, stop auto-pay where possible, and set up a simple monthly budget my dad can manage. Any advice on an order-of-operations, plus any “do this immediately” steps, would help a lot.
Mom (67F) has early dementia and let auto-pay drain her account – what gets prioritized first?
byu/Lumpy-Practice-5484 inpersonalfinance
Posted by Lumpy-Practice-5484
16 Comments
I would say absolutely property taxes first, then utilities. Check with the utility companies for any sort of senior programs they may have for payment plans. Call your local tax authority and explain the situation and see what they can do/check if they are penalties while getting current.
Credit cards would be the absolute lowest priority for me, what exactly are they going to need good credit for?
Get them into a place that offers memory care. It could be harder to do later
have you wrote down the income and figured out what they can actually afford? Then prioritize housing and utilities and food. Forget the credit cards and other things. Cancel all auto pay. Once the property taxes are fully paid down address the other debt by maybe filing bankruptcy if it’s too hard to pay off otherwise.
Autopay is your friend but you need to make sure they’re not spending money they don’t have.
You need to figure out why the credit cards are maxxed.
You need to talk to your father and explain the urgency of the situation and that you need to take control of the finances.
With your mother, focus on one problem at a time rather than the larger picture. “I’m helping you do x” It sounds like you’ll likely need to cut her off from spending (much) money. Try to give her some sort of nominal monthly amount.
Good luck, this is going to get harder before it gets easier.
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Oh, make sure they have wills / a trust in place. You mother is approaching the point at which she wouldn’t be able to agree to such documents.
Property taxes first. Not paying property taxes can result in your home being foreclosed. (It doesn’t happen over night, but not something you want to deal with.)
Turn off all but the most very essential auto-payments. You have to stop the bleeding first, then address the patient. Then, as someone else said, property taxes and utilities are the first priority in order to maintain the home. Until you get a grip on things, the credit cards may have to wait until you get a clear understanding of the cash flow situation. You’re going to be in damage control mode for the next few months, at least.
You should probably get power of attorney while you can (sound mind and all). It makes things a ton easier to get access to accounts and things like that, even jf companies will have a mountain of paperwork and bureaucracy. You’ll need it to get a good picture of your parents’ financial situation.
You may have to completely take over the financial aspect of your parents lives, because your dad has checked out and your mom is not capable.
I can’t stress how important its going to be to be super organized about this. Keep a notebook and log every phone call, email, interaction. You’ll be referring to it often.if you consider the complexity of your own financial life, consider what it means to get your head wrapped around someone else’s financial life with the added bonus of it being messy.
Source: I’ve been through this recently. Its not fun, but hopefully they won’t fight you, which will make ot easier.
Edit to add: being friendly on the phone will go a long way. You can also disclose that your parents are elderly and youre working with them to fix their finances. People understand and are often sympathetic.
Is your father both capable and willing to take over their finances?
If not you will have to remain more involved. Things are likely going to get worse, not better, as far as them being able to manage their accounts. Eye are also more and more like,y to fall for various scams and frauds.
You should formalize this via power of attorney and becoming authorized persons in their accounts.
Dementia is awful and is financially crushing, especially once it’s full blown and they require memory care. You’re talking $8 – 14k / month for true memory care.
Hopefully they live in a state where there’s some assistance and programs. Look for elder care attorneys that can help you find financial aid or prep for Medicaid needs.
Property taxes first. Don’t lose the house. Credit card debt sucks, but cut them up and get them on track to pay off in time that prioritizes everything else.
When you get to the memory care or assisted living stage, hunt around locally for consultants / “consierges” that know the facilities well. They can help you place AND ensure your mom gets the care she needs on the upfront.
Seems like the issue isn’t really the autopays as much as it is the massive pile of credit card debt. If she had been financially responsible prior to the onset of dementia, the auto pays would probably actually be a godsend.
Property taxes #1. The county could sell the property out from under your parents if those are not caught up. Then utilities. Think of things vital to living life, credit cards are not. My step-dad ran out of money after a lengthy cancer battle and we ended up not even paying back many of his credit card companies as they didn’t file to claim anything from his estate when he passed. Just an FYI.
Investigate the property taxes as soon as you can. The notices you have received should have the basic information and the website address for more information. Property taxes have serious consequences but are more clearly defined and have plenty of infirmary available about how to get the back taxes paid. Your state may also have a program to defer some taxes until the house is sold. My state has an assessment freeze so the tax increases become a lien against the house while the senior continues to pay at the current rate.
In my state, back property taxes accrue interest at 9% annually, so the rate is much less than other debts. Additionally, it is three years before the homeowner loses the right to pay off the debt and redeem the house. But, after a certain length of time, there are fees associated with it because the country is required to do the official notices and that is charged to the homeowner.
The property taxes may not need to be paid immediately but you need to find out how the system works and what fees are added to the account and find out the absolute deadline for redemption
Get a bankruptcy lawyer and immediately get POA. That auto pay account needs to be closed ASAP.
We had to do this for a family member in a similar situation. The bankruptcy filing can put a quick stop to debts. The lawyer will advise you on every step to take and in which order.
The sooner you act, the better it will be. I was able to seize the relative’s last $1200 before autopay grabbed it and close the account.
You probably also need an elder care lawyer.
Oh man, this is rough. Went through something similar with my wife’s grandma – it’s like whack-a-mole once you realize how much stuff is just auto-drafting.
First thing: property taxes. In most states they’ll put a lien on the house after like 6-12 months, and that’s game over. Call the county assessor TODAY – they’re usually way more flexible than you’d think for seniors, especially with medical situations. Worst case they’ll do a payment plan.
Credit cards can wait a month or two honestly. Yeah they’ll hit your credit but they’re unsecured debt – they can’t take the house. Utilities… honestly call them too. Most have senior/disability programs that’ll lower bills or give extensions.
What we did was literally sit down with a highlighter and go through 3 months of statements. Found like $400/month in random BS – meditation apps, magazine renewals, that kind of thing. Took screenshots of how to cancel each one and made a binder for future reference.
Also pro tip: set up a separate checking account just for bills, move only what’s needed each month. Makes it way easier for your dad to track without seeing the whole mess.
Why is this on you and your sibling?
Tell your dad that he can’t be hands off anymore. He needs to step up and step in.
Real talk…did the auto payments kill their finances? Auto pay for insurance on an appliance might have been a couple of bucks and is likely not why they didn’t pay their bills. Guessing somewhere along the way there was a loss of income and they didn’t downgrade their lifestyle.
You need to find out when the taxes went delinquent and find out when the redemption period is and pay off all property taxes before that date or you will lose the house. There are no payment arrangements to be made. No pleading is going to get you out of it. It is statutory and pay off has to be made by a certain date. It is likely that a third party owns that note right now.
Then you need to figure out if they can afford their life. You don’t list income and expenses.
Call the credit cards and see if you can negotiate a lower interest rate or let them go to collections and see if they will accept a lower balance. They are not a high priority.
What are you plans for long term care? This is not covered by medicare. There may be some medicaid availability, but resources are stretched thin. You will have to go many years and the situation will need to be dire, near hospice before they get in any where and it will be a not so great facility.
Pull their credit and see what else is lurking out there. There may already be liens and other things you don’t know about.
From someone with brain issues I just wanna say that it’s not our fault and also we don’t know it’s happening… It’s a side effect…