Protecting the elderly from credit card collectors

To Her Credit columnist Sally Herigstad
Sally Herigstad is a certified public accountant and the author of "Help! I Can't Pay My Bills: Surviving a Financial Crisis" (St. Martin's Press, 2006). She writes "To Her Credit," a weekly reader Q&A column about issues involving women, credit and debt, for, and also wrote for MSN Money, and, and has guested on Martha Stewart Radio and other programs.

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Question for the expert

Dear To Her Credit,
My mother is 83 and has dementia. Her credit cards are out of control even though she doesn't use them anymore. The problem is, she thinks she doesn't have these bills, so she wasn't paying them. I tried to pay them for her, but it became a financial drain for me.

She only has Social Security benefits, which she uses to pay rent, phone and cable bill. She has little left over after she buys food and household needs. She cannot afford to pay the credit card minimum payments now as they are long overdue with over-limit and late fees.

I have a power of attorney for her -- what can I do? I have these companies send bills and calls to my home as it is very frustrating for my mother and she becomes very agitated as she cannot remember having credit cards or owing on them. Will the companies eventually go after her bank account? She only has a small account, which she refuses to touch because she wants us to use it for her burial.  -- Roberta

Answer for the expert

Dear Roberta,
I'm all for personal responsibility and paying one's debts, but a person with dementia can no more bear personal responsibility for things they can't remember than a five-year-old could. The credit card companies are going to have to take a hit on this one.

Harry S. Margolis, a Boston attorney and president of ElderLawAnswers, says, "It sounds like the mom is what is often referred to as 'judgment proof,' meaning that the credit card companies may be able to sue her, but they can't collect anything if there's nothing to collect. I'd recommend that the daughter let the companies know about the situation and ask them to write off the debt."

Margolis doesn't recommend that you pay your mother's credit card debts at this stage of her life. If she were more cognizant of her situation, and if the balance was something you and your siblings could get together and pay off, that would be one thing. But paying off a large balance that has become even larger due to mental confusion is not the best way for you to help. Here's what you can do:

  • Write to the credit card companies -- calling on the phone is less likely to help. Keep a copy of the letters for your files.
  • Make sure your mom does not have the cards or card numbers anymore. If you discover she does buy something, send it back.

If the credit card companies write off the debt, your mom will receive a Form 1099 showing the forgiven amount. This is taxable income. However, Margolis says, "If she has no funds she also can't pay taxes."

Some people say that credit card companies should have known that an elderly person doesn't know what he or she is doing and couldn't pay those bills. I wouldn't want the banks making that kind of decision based solely on our ages, however. According to, an online resource for the Alzheimer's community, only 13 percent of 77-year-olds have Alzheimer's or related dementia, and in the group 85 years of age or older, less than half are impaired. Personally, I'm aiming for 100 and hoping to be awake and alert the whole time! It's better for individuals such as yourself to keep an eye on aging parents and step in when there is a problem.

Also, it is entirely appropriate for your mom to save money for her burial. End-of-life expenses, including burial, are generally allowed from a person's estate before other creditors are paid. Check with a legal resource in your state if you have questions.

Taking control of a parent's finances when their mental faculties start to slip is very difficult. So many of us have or have had parents who needed help managing their finances, and older people don't always let go of control quietly. Your mom is fortunate that you are looking out for her interests.

See related: Judgment-proof debtors shielded, mostly, from suits, 5 tips for talking to elderly parents about credit card debt

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Updated: 04-20-2018