Building Your Financial Backup Plan

February 12, 2024

By cdarmody on February 12, 2024

If you are a senior or nearing the end of your career, you’re probably following a financial plan to keep you on track to achieve your goals and desired lifestyle in retirement. But what happens if you should suffer an unexpected illness or hospitalization? Having a backup system in place can help ensure your bills get paid and your finances are managed to your wishes.

Backup systems require proactive planning before an unexpected illness or hospitalization occurs.  Your planning should start with having copies of your healthcare and property power of attorney documents with agents you trust to make decisions for you when you are not able to.  

Once these documents are in place, it’s important to have a conversation with your property power of attorney agent to familiarize them with your bill payment routine. Setting up as many bills as you can for autopayment is helpful. If you want to delegate the chore of bill payment now, consider asking your advisory firm if they offer bill payment services.   

How do you choose someone to handle your finances in an emergency? You should choose someone you trust that will be able to act and respond quickly in an emergency. Consider someone local if they need to access your home mail delivery. If most of your bills are paid electronically, then the physical location of your agent becomes less important, though you likely would still want someone checking your mail and forwarding your mail to the agent. 

Additionally, if you work with an advisor, share your agent choices and their contact information so they know who to reach out to in an emergency. Then provide your advisor and/or custodian with your trusted contacts and their contact information as well. 

It's important for your health and property agents to have an electronic copy of your power of attorney so they can quickly act on your behalf when an emergency strikes. I recommend that agents store these documents on their phones in an app like Dropbox so they can easily prove they have the power to act on your behalf. When I was the agent for my mom, having these documents on my phone enabled me to coordinate with physicians to attend medical appointments and make healthcare decisions.  

Finally, consider adding your financial agent as an authorized signer on your checking account and keep your bills organized to make things easier for them to step in and assume responsibility. Although automating bills helps ensure they are paid on time, you still need to make sure there are sufficient funds in your linked accounts, review bills for accuracy, and have passwords and usernames documented for your agent to access those accounts.  

No one likes to think about situations like this, but it’s really a gift to your family to prepare them before a crisis happens, giving them confidence that they will make decisions in line with your preferences. This helps reduce potential conflict during what can be an emotional time. Most people don’t understand how valuable this preparation is until they’re in the process of dealing with a health crisis and managing a family member’s affairs. We often cover this planning topic in family meetings with clients to help children understand their parents’ agent choices and how they want to be supported during an unexpected illness or hospitalization. 

Although it may seem like a fraught, emotional topic, with some advance planning and preparation, you can make sure that sound financial decisions are being made on your behalf when you need that support most. For help thinking through your backup plan, talk to your financial advisor today.


The opinions and analyses expressed in this newsletter are based on Curi RMB Capital, LLC’s (“Curi RMB”) research and professional experience are expressed as of the date of our mailing of this newsletter. Certain information expressed represents an assessment at a specific point in time and is not intended to be a forecast or guarantee of future results, nor is it intended to speak to any future time periods. Curi RMB makes no warranty or representation, express or implied, nor does Curi RMB accept any liability, with respect to the information and data set forth herein, and Curi RMB specifically disclaims any duty to update any of the information and data contained in this newsletter. The information and data in this newsletter does not constitute legal, tax, accounting, investment or other professional advice. Returns are presented net of fees. An investment cannot be made directly in an index. The index data assumes reinvestment of all income and does not bear fees, taxes, or transaction costs. The investment strategy and types of securities held by the comparison index may be substantially different from the investment strategy and types of securities held by your account. RMB Asset Management is a division of Curi RMB Capital.   

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