Managing Credit Accounts and Finances for a Loved One

Reading time: 5 minutes

Highlights:

• Plan ahead, if you can, in the case of an aging parent
• Know what legal options may exist
• You can place an identity alert on your loved one's credit reports

It's no secret that the population is aging. In 2019, an estimated 6.5 million Canadians are over the age of 65, compared with 5.7 million in 2015, according to Statistics Canada. 

As people age, they may find themselves needing help managing their financial accounts. If you need to help assume responsibility for a loved one's finances and credit accounts, here are some steps you may want to consider -- both before and after a need arises -- to help better protect them from fraud or identity theft. 

Plan ahead if possible

If your parent or family member is approaching an age where they may soon need assistance with their finances and credit accounts, you might suggest he or she add a trusted relative or friend to their credit or bank accounts. This may be especially important if he or she is in the early stages of a progressive disease involving memory loss. If it becomes necessary, the designated person can help pay bills on time, make timely deposits and withdrawals, monitor account balances, and stay vigilant in checking for signs of fraud or identity theft.

Why it’s important: If your parent or other loved one is unable – or becomes unable -- to manage their credit accounts and finances, and you haven’t been able to plan ahead, you may need to piece together their financial and credit situation yourself. In addition, they could pile up unnecessary debt; miss credit card or bill payments, which may result in late fees or penalties and may impact their credit reports; and could be unable to recognize signs of fraud or identity theft. 

If they are able, your parent or loved one may sign a Financial Power of Attorney to designate someone to assist with financial management if they become incapacitated. A Power of Attorney is a legal document in which the person appoints someone else to act for them under certain circumstances. 

As part of your preparation, consider working with your parent or loved one to gather information such as personal identification numbers (PINs) for bank cards, access codes and even passwords for online accounts.

If someone is mentally incapable of managing their finances, a guardian of property can be designated by a court. An attorney can help you find out more about options. It’s important to note that laws relating to Powers of Attorney and the appointment of guardians of property are set at the provincial or territorial level. 

If you have a Power of Attorney which allows you to access and manage financial accounts or are a guardian of property, you can contact your parent or loved one's lenders and creditors and banks to find out what information you'll need to provide to gain access to their accounts.

Monitor your loved one’s credit reports

If your parent or loved one has a credit history, checking his or her credit reports can help you ensure the information is accurate and complete and help you detect any signs of potential fraud or identity theft. In order to access their Equifax credit report, you’ll need to send a written request and documents by mail. Those documents will be used to verify your identity, your loved one’s identity and your ability to legally act on their behalf. 

Please send your request and documents to:

Equifax Canada Co.
National Consumer Relations
Box 190
Montreal, Quebec H1S 2Z2

In your letter, please include: your parent or loved one’s full name, date of birth, Social Insurance number (optional), and the address to send a copy of the credit report. 

To verify your parent or loved one’s identity, please include both of the following: 

• A copy of their birth certificate
• A copy of their driver’s license or any other valid government-issued ID

To verify your identity, please include any two of the following: 

• A copy of your Social Insurance card, showing your name and Social Insurance number
• A copy of your birth certificate
• A copy of your driver’s license or any other valid government-issued ID

To verify your ability to legally act on your loved one’s behalf, please include one of the following:

• A copy of a court order
• A copy of a lawfully executed and valid Power of Attorney

Consider placing an Identity Alert on the person’s Equifax credit report

With an Identity Alert, you can choose to add a personal statement and phone number to the person’s Equifax credit report. If the person lives in Manitoba or Ontario and someone applies for credit in his or her name, lenders and creditors are required to call to verify the person’s identity before issuing credit. If the person lives elsewhere in Canada and a credit application is made, lenders and creditors are encouraged – but not legally required – to call and verify the person’s identity before issuing credit. An Identity Alert stays on the person’s Equifax credit report for six years, unless a request is received in writing asking that it be removed. 

If the person has been a victim of identity theft, you can place a Fraud Warning on his or her Equifax credit report. This is a statement added to a credit report including a phone number to encourage lenders and creditors to verify the person’s identity before extending credit. Fraud Warnings stay on an Equifax credit report for six years. If a Fraud Warning is placed, Equifax can also launch a fraud investigation to assist with any fraudulent inquiries/accounts or other fraudulent information on the person’s credit report. 

Learn more about Identity Alerts and Fraud Warnings.

Keep track of credit card charges and bank account activity

You’ll want to keep an eye out for any indications of fraud or identity theft on your loved one’s accounts – unauthorized charges or withdrawals, for instance. 
It’s worth taking the time to do your homework and get all your questions answered to secure your loved one’s financial future and help better protect them against fraud, identity theft and financial abuse. If you need help, there are many resources and professionals who can help you navigate the process.