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Sunday, July 25, 2021

What is a Daily Money Manager? Who Needs One?

DMMs provide vital, daily financial services for many, including older adults who no longer can, or want to, manage their money.

“Phil” had always handled his own finances, but at 87, the details were overwhelming. He could no longer be sure that everything was getting paid on time, and when an illness left him with medical bills, he knew he needed help. Phil asked a good friend to assist him, but the friend didn’t feel comfortable getting involved in financial matters. Phil’s daughter lived in another city and he knew she was too busy with her three kids to help him out. Besides, a lot of the hospital bills were coming in the mail and he couldn’t keep track of them all.

Phil’s scenario is not at all uncommon. Perhaps a spouse who handled the money dies, and the remaining spouse is overwhelmed by the new responsibility. Maybe it’s simply a case of cognitive decline; someone who used to manage her own stock portfolio can no longer keep track of her savings and checking accounts. Perhaps an adult child is stealing from a parent and a professional needs to be brought in to oversee the money. Or an adult child is POA for a parent but he is so busy he can’t keep track of bills coming to his parent’s home. In all these cases, hiring a daily money manager (DMM) can solve the problem.

What a DMM Does

Basically, a DMM takes care of household finances for clients who may be wealthy individuals, busy professionals, people with disabilities or older adults. More and more of these clients are aging adults as seniors and the professionals who serve them become aware of the valuable service a DMM performs. “We manage a broad range of services for clients, such as bill pay, bookkeeping, account reconciliation, and we work with health insurance claim forms — everything that comes across your monthly mail that relates to your personal finances," says Alison Salisbury, founder of Fiscally Fit, a daily money-management service company in Mountain View, CA.

 A DMM will pay all of a client’s bills, disputes incorrect charges, balances the checkbook, prepares and makes bank deposits, obtains and organizes tax documents, and reviews and pays medical bills. The client and DMM can meet at the client’s home, over the phone, on Zoom or however the client prefers to keep in touch, which may be weekly, biweekly, or monthly. 

A DMM may also provide additional services, such as:

  • Notary services.
  • Accepting responsibility to act as power-of-attorney or representative payee for Medicare.
  • Fiduciary services such as trustee, executor, conservator, guardian, or health care proxy.
  • Preparation of payroll checks for home employees including calculation of Federal and state withholding and FICA taxes.
  • Financial counseling.
  • Preparing budgets of spending plans.
  • Preparing plans to reduce debt.

Who Are DMMs?

Most DMMs have a bachelor’s degree and three or more years of experience. While many DMMs don’t have credentials, they do require credibility. For instance, they may have worked in a financial or business field, or have a background in social service agencies. DMMs may work under the moniker of “bill pay services.”

Certified daily money managers (CDMMs) are financial professionals who have earned the certification from the American Association of Daily Money Managers, a trade organization that supports ethics while providing information and education to members and the public. CDMMs have met eligibility requirements and passed an exhaustive exam on topics ranging from Social Security to Medicaid, insurance, banking practices and security issues to ensure high standards and quality service. Additionally, CDMMs must pass a background check and have at least 1,500 hours of experience under their belt to qualify for the designation.

How to Find a DMM

You can seek referrals from accountants, estate lawyers, or agencies that help older consumers. Do check with your state attorney general’s office and the Better Business Bureau to see if any complaints about the person have been filed before hiring.

Professionals who advocate for older adults and people with special needs are often a great resource for DMMs. They often go into the home and can report back to the family when appropriate, such as when the person they are helping is not taking prescribed medication, is in deteriorating condition, or can’t maintain the home. They can then provide the services of a social worker and/or mental health-care advocate to help out, and the service can oversee aides. They may be found by searching terms such as:
  • Elder advocate
  • Mental health advocate
  • Financial advocate
  • Daily money management
  • Life care management services
  • Life enhancement
  • Lifecare for seniors
  • Geriatric care manager

Another great way to locate a DMM is through the trade organization, listed above, whose more than 700 members must abide by a code of ethics. 

Meet with several DMMs to find one who is the right fit for you. Do they have a minimum fee? How are they paid? How long have they been in the job? Will they come to your home? How will they share information about bills they are paying and other tasks? Do they have similar clients from whom you can get a referral? 

What Should You Expect to Pay?

How much you will be charged depends a lot on where you live, but it’s usually in the range of $75 to $150 per hour. Generally, it would cost much more to have a CPA take over the job. 

A DMM can save you money in the long run. Your DMM may ask if you’re using all of those cable subscriptions. He or she can negotiate a better price on certain services, and a DMM notices if you’ve been billed twice or for something Medicare should cover. There are other benefits, as well.

"I am the eyes and ears," says DMM Barbara Boustead. She can see if "Mom hasn't been taking medication or she needs someone to come in and help out during the day."

Hiring a daily money manager can lift a load of worry off the shoulders of an older adult who cannot manage paying bills, and it can be a lifesaver for adult children tasked with managing the finances of their parents. Having someone else manage financial matters can give them peace of mind and allow them to put their energy on tasks that are more pleasurable and central to their interests. For many, this would include maintaining close relationships between children and aging parents. You can’t put a price on that.


Blog posting provided by Society of Certified Senior Advisors

This article is not intended to be a substitute for professional financial advice from a qualified financial advisor.