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How to Effectively Manage Someone Else’s Financial Resources

Written by
Written by

Melody Wright is a Canadian business writer living the dream in South America. After almost 3 decades of training professionals in the finance industry, she semi-retired (early) to rescue dogs and enjoy life with no winters. She lives with her husband and 70 (or so) dogs, 3 horses, ducks, and chickens on 25 gorgeous tropical acres. She writes articles on personal finance to help others retire earlier and enjoy life to the fullest.

Melody Wright
Financial Resources

Many Canadians handle financial resources or matters for a loved one who can’t do it themselves. This can be a difficult task. Thankfully, there are many financial support tools to help.

Here’s some valuable information about financial literacy to help get you started as a financial caregiver.

Being well prepared is key

Just doing your own financial management can be overwhelming, let alone taking over someone else’s. Keep in mind that you don’t necessarily need to take over everything at once. If the person you care for is still capable of doing certain aspects of their finances, take a step-by-step approach.

When you take over someone’s finances, you take over future financial planning and must make many decisions on their behalf. That’s why it’s best, if possible, to start early when they are still capable.

Starting early allows you to ease into the process. It also gives your loved one the opportunity to share their preferences with you. Most importantly, it can avoid a lot of headaches in terms of family disputes, cleaning up a financial mess, or even legal issues. A good plan can help you manage effectively and efficiently.

Steps to take when starting

Follow these tips to start your journey:

  • Discuss money with the person you care for. Find out everything about their finances, including if they are receiving any Canada Pension Plan payments, income support, or financial aid.
  • Be considerate of people’s desire for independence. Offer to start with small tasks, like paying bills or helping apply for financial assistance.
  • Get input from others. Include all family members affected early on.
  • Make a list of all financial resources, expenses, and debts. Also, keep a record of all bank accounts, credit cards, insurance policies, credit applications, user IDs and passwords.
  • Create a budget. Include financial resources and expenses, both long and short-term.

What official money management options are there

A fiduciary makes financial decisions for someone else. There are several ways to become a fiduciary.

  • Power of attorney (POA). A POA is a legal document allowing one person to make financial decisions for another. 
  • Trustee. A living trust is a legal plan to distribute someone’s assets after they die. A trustee manages the assets per the grantor’s instructions and best interests.
  • Professional fiduciary. This person can be an attorney, Certified Public Accountant or trust company officer.
  • Government fiduciary. Government fiduciaries manage Canada benefits payments. 
  • Court-appointed guardian. A court may assign a guardian or conservator to someone who can’t handle their own assets. 

Tips and best practices

  1. Always act in the best interest of the person whose money you are responsible for.
  2. If you’re in charge of someone’s money, never use it for yourself or others.
  3. Manage their money and assets carefully. Pay the bills on time, keep unspent money safe, invest wisely, and keep a record of any money spent.
  4. Keep your money separate from theirs. Avoid sharing accounts. 
  5. Maintain good records. It’s better to avoid paying in cash and keep receipts to prove purchases.

Easily missed resources

When creating a list of financial resources, don’t forget to include easily missed things like RRSPs, TFSAs, and safety deposit boxes. Being thorough will help avoid issues down the road or missing out on funds when they are often needed most.

Don’t forget important tasks, like filing income taxes with the Canada Revenue Agency. It’s best to stay on top of these things to avoid complications and penalties. 


People who manage money must make choices that benefit their clients or loved ones. Being open and honest about their decisions can prevent doubt and mistrust.

  • Keep a written record of every dollar spent
  • Don’t borrow from the account
  • Don’t use their account to pay for anything that may benefit you or anyone else, regardless of whether it may also benefit your loved one

Keep everything separate

There’s a big difference between informal and formal arrangements. Formal agreements keep your personal finances separate.

Be careful about signing any contracts or agreements on someone else’s behalf. Especially if you do not have legal documents to separate your finances. You may be liable for any costs.

Plan, if you can

As a caregiver, it’s not uncommon to end up managing someone else’s finances as a last resort without any prior discussion. Having these difficult conversations and planning ahead is crucial. These conversations go a long way to ease stress and anxiety for both parties involved. This is particularly for loved ones that have Alzheimer’s or dementia.

Financial exploitation

Sadly, sometimes people with authority over a person’s finances take advantage of them and steal their money. This is one of the most common forms of financial abuse. Knowing what to look out for goes a long way to being able to help.

Common signs that someone is being financially abused:

  • Missing property or money
  • Sudden changes in money habits
  • Unclear or vague explanations of transactions
  • Frequent ATM visits
  • Big, unexplained bank withdrawals
  • Excessive gift-giving
  • When the caretaker prevents visitors or phone calls with loved ones

If you suspect a family member is being taken advantage of, contact the police.  

Managing their debt

Once you have created a budget, sort debts by interest rates and due dates. Pay the most important ones first. If they have many debts with high-interest rates, consider applying for a consolidation loan or Debt Management Program.

If you are having difficulties, seek assistance from a financial advisor or credit counsellor. They have the financial education and resources to help.

It is well worth the time and effort to be fully informed about what debt you are responsible for. It’s not uncommon for collection agencies to contact next of kin to settle the debts of loved ones, whether they are responsible to take on the debt or not. Know your rights and be prepared.

Preparing for someone to take over your finances

If you’re planning to have someone take over your finances at one point, here are some tips:

  1. Create a financial emergency kit. Write down step-by-step instructions regarding which bills get paid, when, and how to pay them.
  2. Start a conversation. Talk to the person taking over your finances. Make sure they understand what’s expected and what their responsibilities will be.
  3. Respect your own wishes. Make sure that the person taking over your finances is trustworthy, understands what you want and will respect your wishes


Managing someone else’s money is a serious responsibility. It’s important to plan ahead while the person can still make decisions so everyone agrees when the time comes.

In charge of taking care of the finances of someone that is drowning in debt? If so, talk to one of our trained credit counsellors for free guidance. We’ll help you find the right financial services to turn things around.

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