How to Choose the Best Money Management Programs for Seniors
According to the U.S. Bureau of Labor Statistics’ most recent Consumer Expenditure Survey, the average American household pays approximately $5,000 per month in recurring expenses. Housing costs, including mortgage or rent payments, HOA fees and utilities make up the bulk of these monthly bills. Many seniors also receive regular invoices for their automotive, property and health insurance, municipal taxes and subscription services.
Keeping on top of all these expenses can be a challenge, especially for older adults who may not be comfortable receiving and paying their bills online. Vision loss, cognitive issues and chronic medical conditions can also make managing household finances tough for seniors.
A bill management service, also known as a daily money management program, can help seniors retain their independence by ensuring their household and personal bills are verified and paid on time.
Not only can money management services alleviate stress on seniors, but these companies also provide family caregivers with much-needed relief from the burden of managing their loved one’s day-to-day finances.
This guide provides an overview of what you should consider when choosing the best money management program for seniors.
Decide What You Need Help With
Start by making a list of the financial tasks you need help with. For a family caregiver, this could include:
- Receiving, verifying and paying recurring household invoices such as cell phone and credit card bills, energy bills and HOA fees
- Managing all mail
- Filing insurance claims
- Organizing tax return documents
While all money management services take care of bill payments on behalf of their clients, the availability of additional services varies between companies.
Research Which Money Management Companies Operate in Your Region
While most U.S.-based money management companies offer nationwide services, if you’d like to meet with your account manager in person, you’ll need to choose a company that offers that option in your region.
You’ll also want to understand:
- How much in-person appointments cost
- What, if any, travel fee is charged, and how this fee is calculated
- If you can continue using a particular money management company should your loved one move to a different city, county or state
Consider How You’d Like To Communicate With Your Account Manager
Service models vary between money management companies. Some bill paying services operate on a virtual basis only, which means that your account manager is only available via video chat, phone, text messaging or email.
Think about how you’d like to interact with your account manager. You may want:
- To receive monthly paper statements summarizing the services and financial transactions completed by the money management company
- Access to a secure online portal where you can keep track of your loved one’s finances in real time
- The ability to set up regular account review meetings, either in person or through a video chat
When choosing a money management program, be sure to ask if there’s a limit to how frequently you or your loved one can communicate with your account manager. You’ll also want to find out if there’s a fee charged each time you contact your account manager, and if so, what that fee is.
Verify Security and Screening Protocols
Bill management services for seniors are designed to protect older adults against financial fraud and exploitation. In general, companies that offer money management services maintain robust security and screening protocols, but it’s always a good idea to do your own due diligence.
Here are some things you may want to ask each bill management company you’re considering using:
- How long has your company been in business?
- Is your company a member of the American Association of Daily Money Managers (AADMM)?
- What steps do you take to screen your account managers?
- How do you prevent employee theft and fraud?
- Is your business fully insured, and if so, with which insurance company?
- Do you conduct regular, recurring background checks on your employees?
You might also want to ask:
- If I receive a call from someone claiming to be my account manager or an employee of the bill paying company, how can I be sure it’s not an imposter?
- If a client’s financial information is compromised through a data breach or cyber crime, what does the company do to protect them against identity theft and fraud?
Consider the Costs
Money management program fees vary widely, as do their fee structures. Some companies charge a flat monthly fee for a set number of transactions, while others bill on an hourly basis. Some use a combination of flat fees and hourly rates.
When researching which bill paying service is right for your family, be sure to ask each company:
- What the fees are
- How the fees are calculated
- What services are included, and excluded, in the set fees
- If there are additional costs for travel time
- How and when the fees are paid
- Whether you need to sign a service contract, and if so, what’s the minimum contract length
When choosing a money management program for seniors, you’ll also want to understand the refund policy of each company should your loved one pass, or if you’re simply unhappy with the service.
Can Account Managers Make Investment Decisions?
In general, no. Bill payment service account managers are not allowed to provide investment advice to their clients, nor can they invest their clients’ money.
What Kind of Education and Training Do Money Management Program Account Managers Need to Have?
While there are currently no set regulations that dictate the credentials an account manager needs, most money management companies will only hire employees who have a bachelor’s or graduate degree in business, social sciences or finance.
Additionally, some money management companies ensure that all their employees hold the Certified Daily Money Manager designation. The CDMM certification process is administered by the American Association of Daily Money Managers, a nationwide professional association.