Aging in Place: Everyday Money Management

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Steve Lorberbaum:

Well, good morning, everyone. Thank you for joining this month’s edition of What’s Your Plan? My name is Steve Lorberbaum, I’m the owner of Assisting Hands Home Care Potomac. We provide aids in people’s homes, all around Montgomery County, parts of PG County, and Fairfax County, Virginia. And I’m excited today to have Leah Nickaman with us. She is a money manager, and I will let Leah explain a little bit about her company and what she does, and then we have a series of questions that I will ask so that hopefully we can get a full understanding of the array of services that money managers can provide. So, Leah, welcome, and thank you for joining us today.

Leah Nichaman:

Oh, thank you very much for inviting me. I’m very happy to be here, and happy new year to everybody. I already see a few people who I know. So you all know a lot of the things that I’m going to say, but feel free to jump in with any questions or clarifications if you’d like to. I am the founder and the owner of Everyday Money Management. We are in our 14th year of business, and I have a team of wonderful daily money managers who provide the services, and we provide our services in the DMV, as well as throughout the country. Remotely because of COVID we got a lot better at doing things remotely. So we have some people who are out in the Hamptons and a few other places around the country.

Leah Nichaman:

I did not make up Daily Money Management. People often say, how creative, how wonderfully did you think that up yourself? And I say, no, I did not. Actually, there has been an association, the American Association of Daily Money Managers around for over 20 years, but I found it when I was working at the National Alliance on Mental Illness and trying to find resources for people that have a mental illness, and were having a really hard time with money. And particularly people with various serious mental illnesses can have trouble with money, but often it was people who had bipolar disorder, or anxiety disorders of various kinds, and depression that would make it very hard for them to concentrate, to focus, and to stay on top of these things.

Leah Nichaman:

So I started off helping people who had a mental illness and then branched out very quickly into helping seniors. And we are now also helping quite a few busy professionals or early retirees who either need to get control of their spending or if they simply just don’t want to do the task of taking care of their finances anymore, and they want to outsource it.

Leah Nichaman:

It is true that I have been the president of the American Association of Daily Money Managers, and that was a wonderful experience. And right now my colleague, who’s on this call, Sharon, is on the board of directors of the association as well. And the only other thing I’ll say is I am a representative payee, and if anybody’s interested in doing this type of work as a volunteer, the representative payee program at Every Mind is a great way to volunteer if you have this skill set.

Leah Nichaman:

Now, so that’s kind of how I got into it, trying to help people with mental illness.

Steve Lorberbaum:

So let me ask you a couple of questions.

Leah Nichaman:

Sure.

Steve Lorberbaum:

Is the audio okay? It seems like it’s reverberating a bit.

Patricia Dubroof:

Yeah. If I can just ask folks to mute themselves where they are. That would be great. Thanks.

Steve Lorberbaum:

Okay. So, it says Everyday Money Management. Well, what does that exactly mean? Do you pay people’s bills?

Leah Nichaman:

Yes, and more. So when people hear money management, a lot of times they think that we are investment managers, because I think historically people have called their investment manager, or their broker, a money manager. And so they often want to know if we do investments, and the answer to that is no. What we do is we help people do the stuff that you usually do yourself, the day-to-day handling of paying your bills, reconciling your checkbook, although most people don’t do that anymore, we do that for people. Filling out, doing insurance claims, if you have to file insurance, getting your tax information together, those kinds of things. So it’s the day to day personal financial management that most of us have some sort of a system for.

Steve Lorberbaum:

Okay, so it’s-

Leah Nichaman:

In most families, one person does it usually.

Steve Lorberbaum:

Right? So it’s bookkeeping services in many respects.

Leah Nichaman:

It is. It’s a lot of it is bookkeeping. But I say that the difference between a straight-up bookkeeper and a daily money manager is that a bookkeeper’s job is to worry about keeping the books, of course, tracking income and expense things in and out of the various accounts, as well as paying the bills. So accounts payable, and to some degree, maybe accounts receivable, and the bookkeeping. And what we do is we’re very concerned with how healthy and well-managed is that client’s financial life. So we’re worried about all the things, in addition to the bills being paid, which by the way, is a pretty small amount of time relative to what we do for our clients. It’s not the bill paying part. It’s really all the other money management bits and pieces.

Steve Lorberbaum:

Gotcha. So if you let’s say, I go to the doctor and my insurance company doesn’t pay what I think they should pay. You can help me file an appeal and do that whole process, which is unknown to me, how that happens. Is that something you do?

Leah Nichaman:

We could. Generally we’re good on the first appeal.

Steve Lorberbaum:

Okay.

Leah Nichaman:

I would say we are not insurance experts and there are people who are medical billing and insurance experts, and so if we get a gnarly case where, and especially if the dollar value is very high, we would absolutely be suggesting to our client that we use one of these billing advocates in order to get that worked out. But I can tell you a lot of the insurance stuff that we do, it’s really simple stuff. Like the social security number that was used on this Medicare, claim is not correct. Or it looks like you had the same procedure done twice in the same day, and we’re not going to pay for it. And those are usually pretty easy to figure out, or we didn’t have your secondary insurance and so we’re billing you. And it’s a lot of times it’s us just sending in the secondary insurance information so it gets built.

Steve Lorberbaum:

Okay. And long-term care insurance, you can help with filing those claims as well?

Leah Nichaman:

We can help with filing the claim. We can help with keeping track of the reimbursements. So some people use a home care agency that will file those reimbursements for them. I don’t know if Assisting Hands does that, but even if the home care agency is filing the claims, somebody should be monitoring that who is on the client’s financial team. So often we’re the ones paying attention to making sure that that is happening, or we’re the ones filing those claims.

Steve Lorberbaum:

Gotcha. Yeah, I mean, Assisting Hands we do that on behalf of our clients, but still, if we’re not the assignment of benefits person where we’re receiving the checks directly, somebody on the client-side is managing, reconciling the payments to us out and the payments in, from the insurance company to make sure they’re being paid for all the services that we provided up to the level of their insurance policy.

Leah Nichaman:

That is correct.

Steve Lorberbaum:

Okay.

Leah Nichaman:

Right, so could I give an example by the way of how a daily money manager might differ from a bookkeeper just around the issue of long-term care insurance? And Joe, you’ll be interested in this is that when we come and meet a new client, we do what we call discovery, right? And this is something, even if it wasn’t a daily money manager, and you were an adult child, and you were trying to step in to help your parents, the very first thing you would have to do would be discovery. You would have to figure out what’s what, and part of that discovery is asking, do you have long-term care insurance? And sometimes people don’t even remember. They’re like, I think so. I don’t know. So then we go off to the file cabinet and we find that, Oh, yes, it looks like you have a John Hancock policy, but we can’t find a copy of the policy anywhere. And so then we call the insurance company with our client and we say, could you please send us a copy of the policy? Because if they’re thinking about going on the claim, we really want to know what are the rules of that policy. So we may call the person who sold it to them, or we may call the insurance company, but we really want to know what are the rules.

Leah Nichaman:

And there have been times where I have seen clients who’ve got themselves into a home care situation where their caregiver, who they love and don’t want to leave is actually not covered by their long-term care insurance. And had somebody known at the time that they were hiring a home care provider, what the insurance would and would not cover, they wouldn’t be in that pickle. So knowing ahead of time what people have is really important. So a DMM, a daily money manager, can really help with corralling all that information.

Steve Lorberbaum:

Gotcha. So, and I assume this is something you do as well, I know I worked with another daily money manager with a client and through his discovery process, he found bearer bonds that were significant amounts of money that the client did not remember they had, but as they went through files, they found these bonds that were able to then be deposited or whatever they do, registered, and ultimately liquidated to pay for a significant portion of the client’s care.

Leah Nichaman:

Yup.

Steve Lorberbaum:

I assume you have a similar thing that happens to you.

Leah Nichaman:

I have that experience. Yes. And my client had a quarter of a million dollars in savings bonds. That’s a lot of money. That’s a lot of little pieces of paper. So that really helped out. Yeah.

Steve Lorberbaum:

And so, but you’re not like a financial advisor or an insurance broker that’s selling other things. So you don’t sell insurance or any of that stuff.

Leah Nichaman:

No. We don’t sell anything. Yeah. We don’t sell anything except for our services. And what we are though is we see ourselves a lot as the… How should I say? What’s the fluid that goes around your knees? The thing that kind of brings the team together. So a lot of times we’re the liaison, right? Between the financial advisor, the insurance agent, the attorney, and the accountant. And we get nice and close to the accountants around starting in February, right? Between February and April, we are in a lot of contact with our clients because by and large, for clients for whom we are helping really in a very significant way to manage their finances, we’re responsible for the tax package. And we make sure that all those documents get to the accountant plus their list of deductible expenses. So we are busy during February and March doing that.

Steve Lorberbaum:

So in the pre-COVID world, let’s talk about that.

Leah Nichaman:

Oh, I miss it.

Steve Lorberbaum:

And it’ll come back at some point. I’m predicting the July, August timeframe, unfortunately, but it will. I mean, vaccines are starting to roll out. But I assume you went to people’s homes and helped them sift through their boxes of stuff.

Leah Nichaman:

We did.

Steve Lorberbaum:

How do you do it today?

Leah Nichaman:

So for people who live locally, we would go to their homes if they wanted us to. So mostly our seniors would want us to come to their homes, our busy professionals, not so much. So those, even if they lived down the street from us would often be a remote engagement. Now, what we’re doing is we are having some limited contact, of course with lots of protection measures in place, masks and distancing, et cetera. And we may do what we call a drive-by. So we’ve asked our client or their caregiver to help us sometimes, depending on the cognitive status of the client to put together the mail, the bills, the things that we need to see, and we drive by and we get a handoff. So we can sometimes operate with paper.

Leah Nichaman:

We have a few clients who, with their power of attorney’s permission and their permission, we went completely digital. So we turned off the Petco bill. We turned off the Verizon bill, and we set up an account for them, and we have everything coming digitally. And we usually set up an email address that we can all share. That is the receiver of notifications and that kinds of thing. So nothing gets stuck in anybody’s personal email, it’s in sort of an email address that we’re sharing with the client and their POA, if that is what they want.

Leah Nichaman:

So we are really able, if people are really willing to embrace managing their finances digitally, we can serve them remotely. The hardest part of it and the only part that’s really challenging is if they get a bill in the mail, like a one-off, a medical bill, their landscaper hands them a bill, that kind of thing. They probably will, if they know how to scan an email, they can do it, but if they don’t know how they’re going to have to tuck that into an envelope. And so we’ve been so grateful actually to the postal service. I know the postal service is having a lot of pains right now, but we have been able to use flat rate mailers with our clients really successfully. Every week or two put all this stuff in the flat rate mailer, if it fits it goes, right? And they just toss it in the mail to us and that has worked out well for our people who are still paper-based. So it can totally be done.

Steve Lorberbaum:

Gotcha. And I know from our experience, we have clients where our aid will have a pre-addressed envelope, and it’s just, she gathers up the mail for a week or whatever it is, stuffs it in there and sends it off to the money manager, who then opens up the bills.

Leah Nichaman:

Exactly.

Steve Lorberbaum:

And the great thing that we’ve found is it also cuts down on fraud, and people paying bills that aren’t even their bills, because they’re not even opening their own mail, it’s just going into an envelope going to you. And then you’re deciphering what’s real and what’s not. So they don’t get scammed.

Leah Nichaman:

Yes. Yes. I mean, at some point, to be honest, people are safer and better off financially if they allow themselves to step back from their finances. Sometimes people meet that challenge with quite a bit of resistance, and it’s really hard for them to let go. And I encourage family members to be very patient with their family member who’s reluctant to let go and do work arounds until they either get tired of it or they make a big mistake and they realize it’s time, but people come to that feeling of it’s time for me to hand this over to the bookkeeper, or to my daughter or son, they come to that at really different rates. It’s very personal.

Steve Lorberbaum:

And do you have any sort of, and I don’t know if you do or not, but sort of a software program so that if a family member, a son or a daughter wants to be able to sort of log in or see what is going on with their parents, their activities, what are they buying? What are they paying for? Do you have some sort of reporting or way they can log in and just see what’s going on?

Leah Nichaman:

Yeah. We don’t have any kind of a custom or software where they can log in and see everything up to the minute. What we end up doing is we use Quicken to track income and expenditure, and we provide monthly reports to our clients. And if clients wanted to see the Quicken file more often, we figure out a way to do that. Usually our clients have access to the bank. I mean, their family member, at least one family member or the power of attorney has access to the bank. And we encourage them to check regularly. We’re checking too, but them checking is a check on us, and us checking is a check on them. And a check on the potential scammers and the check on their financial advisor. Like the fact that we’re all watching each other and for potential outside fraud is that is the safest best way.

Leah Nichaman:

So a client really means be willing to give a certain amount of transparency to the people that they trust, a small number of people that they trust. So then the family member can see what they’re spending in an organized way by category when we issue them a Quicken report.

Steve Lorberbaum:

Gotcha. So for sort of younger adults, let’s say with cognitive challenges or psycho emotional challenges, can you help them establish their monthly budget and help them sort of stay on track? Is that something you all do?

Leah Nichaman:

We have done that. We aren’t doing as much of that anymore? The establishment of the budget is the easy part, pretty much for everybody actually. It’s the sticking to it that can be very challenging. And honestly, I often get family members saying, I want you to teach my daughter or son how to manage their money. And what they’re really asking is I want you to teach my son or daughter to have impulse control and that’s a psychological matter.

Steve Lorberbaum:

[inaudible 00:19:04].

Leah Nichaman:

And so to the extent that we, I mean, we are very nonjudgmental coaches often with clients, but what I have found with people who really have impulse control, whether they have a mental disorder or not, right? But it’s just hard for them to not spend. What I find is helping them to put up fences for themselves, guard rails for themselves. Right. So putting themselves on an allowance, right? So we often will help them to set up, instead of one checking account, they have two checking accounts. One is for bill paying and one is for the discretionary stuff. And they have to promise themselves, and us, that they are not going to touch the bill paying account, right. Because that’s the money that is set aside to pay the regular bills so they don’t get their lights turned off or get evicted from their apartment. And the rest of the money is what they have for their food, and their entertainment and that kind of thing. And I’ve seen people really get on board with that, and move a credit card system to a debit system, right? So that they’re not racking up credit card debt that then somebody has to bail them out of. And then I’ve seen people fail spectacularly at this, because they just couldn’t control their need to spend.

Leah Nichaman:

And at that point, sometimes we have to tell the client, you’re wasting your money hiring us to help you because we can’t. We can’t make you stop. We’re not there every minute, you know? So helping people to move the money that they shouldn’t spend away from their access, easy access, is the best way. And if I had a trouble with spending, I would put myself on allowance. I would give myself a reloadable debit card and have no credit cards. Like I would try to make it hard for myself.

Steve Lorberbaum:

Okay. So one last question, and then we’re going to open it up to anyone else that has questions. So if, let’s say we’re a senior and they need to get a stairlift put in and they’ve gotten quotes from two different companies. Can you help them evaluate the quotes and make a decision on which is the best company to go with? Or is that beyond kind of what you all do?

Leah Nichaman:

No, no, no. That type of consumer advocacy is fine. I think what we want to avoid is making the decision for them, but helping them arrange for estimates, helping them evaluate the pros and cons being the one. So we have sat in meetings where they are interviewing a lawyer or interviewing an accountant, and maybe we do two or three and then they will choose. Often people ask us who would we choose, and we just don’t answer that question. We say, it’s really important for you to think about what you want, et cetera. And sometimes it’s very clear, like with a stairlift company, we might point out to the client that this warranty, it’s a 10 year warranty and you’re thinking about moving to assisted living next year. So maybe you don’t need something so long. So whatever it is that is, so yeah, the answer is, we will absolutely help with them trying to get a good deal. And we often will say, don’t let anybody tell you need work on your roof, or your trees, or any of that kind of stuff. You can always call me and ask. So we try to be that buffer between them and the scammers.

Steve Lorberbaum:

Gotcha. That’s great. Because I know-

Leah Nichaman:

We do a lot of coaching around the IRS is never going to call you, and don’t give out your social security number, and we put stickies on their checkbooks, it says don’t give out these numbers, and we do the best we can given that we’re only seeing them maybe twice a month.

Steve Lorberbaum:

Gotcha.

Leah Nichaman:

Yeah.

Steve Lorberbaum:

All right. So anybody have any questions for either Leah or myself?

Patricia Dubroof:

So the question is, how does one get started? What are the steps to take, and what are the renumerations to have your services?

Leah Nichaman:

Yes. So the first step is that person would need to call them, or their representative. It could be their daughter, their son, doesn’t have to be a legal representative. Often it’s their lawyer or somebody else calling and saying, I have a client and I think they could really use your help. And then usually, I’m the one who will field those calls and I will ask a few questions about what they need and try to figure out whether or not we are the right solution and sometimes we’re not. They’re actually looking for an investment advisor. And so we give them some names and send them on their way. So we figure out whether or not we are even the service that they really need.

Leah Nichaman:

Then hopefully, if I am not already talking to the potential client or the potential client’s family member, the next conversation is with that person, with the client. And then we have a free initial consultation, which is usually in pre-COVID times it’s an actual get together at the client’s home. Now we’ve been doing them on Zoom. We’ve done a few in garages when the weather was better. But basically the idea is that it gives our client a chance to meet us, and they might meet me or they might meet Sharon who’s our client service manager, and they would meet the daily money manager on our team who’s going to serve them. So I don’t want anybody to hire us before they’ve had a chance to actually speak to and get to know even a little bit the person who’s going to be their person, because we don’t switch around people. We dedicate a daily money manager to be that person’s person.

Steve Lorberbaum:

So let me interrupt you. How do you bill for your services? And what’s a range of [inaudible 00:25:05]? Can you give a range of what a likely monthly bill would be? I realize it’s hard to do that.

Leah Nichaman:

Right. So we bill for our services hourly. Our current rate is $130 an hour. I would say that we are on the higher side in our market, but we are an established company. In the daily money management world, we’re actually a big company. There aren’t too many that are bigger than ours. And most of the daily money managers are solo. So sometimes people have to think about what they want to purchase in that, and when you hire somebody who’s solo, you’re also need to be concerned about what happens to them. And we always have backup in our company. We have audit trails and quality control and a lot of things that you might not get with a solo. So not to disparage the solos in our market, they’re wonderful, wonderful DMMs people. The client needs to think about what they want. It’s sort of like if you ever put kids in daycare. Do you want a daycare center or do you want a nanny to come?

Steve Lorberbaum:

Gotcha. Is there a range of price that people could expect? Is it typically-

Leah Nichaman:

I think people could expect, based on my knowledge of what’s going on in our market, in the DC area, I would say that people could expect to pay anywhere from $85 to $150 an hour. And in some cases, they price out on a flat basis?

Steve Lorberbaum:

But what I’m looking for is-

Leah Nichaman:

Oh, each month?

Steve Lorberbaum:

Yeah, what’s the typical monthly cost of [inaudible 00:26:40].

Leah Nichaman:

Yes. So with us, we have a three hour minimum. So right off the bat $390 would be the minimum. So people have to, and I’d say that most daily money managers are, in order to do the job well, right? It’s not going to take fewer than three hours a month. But people can expect, I would say, in discovery and the streamlining phase when we’re kind of cleaning things up, and making a mess into not a mess, it could be anywhere from, six to 20 hours. Right. It could be a lot depending on how big the mess is. Right. But once we’re in maintenance, I’d say three to six hours a month.

Steve Lorberbaum:

Gotcha. Okay.

Leah Nichaman:

Yeah.

Steve Lorberbaum:

Well, I’m mindful of the time. So unless we have any more questions in the chat, we’ll wrap up. Leah, thank you for joining us. This was hugely helpful.

Leah Nichaman:

Oh you’re welcome. You’re very welcome.

Steve Lorberbaum:

The thing I love about this is that even though I know you and we’ve worked together in the past, I learn something new each time I talk to someone. So again, if anyone is interested, I think we have Leah’s information.

Leah Nichaman:

Call me.

Steve Lorberbaum:

On a slide, and you can certainly give her a call or shoot her an email. She’s got a great team of people. We’ve worked with a number of your folks with various clients. And it’s amazing the range of services some get to pretty much minor autopilot to digging in, wadding through a room full of documents trying to find stuff.

Leah Nichaman:

Oh, yes. We’ve done that too. Yes.

Steve Lorberbaum:

So, that’s it. And again, Assisting Hands where we partner with lots of different people to provide home care services, and all the support services. So if anyone has any questions as well, you can reach us, or you can reach out to Patricia as well. So thank you everyone for joining us today. I hope you found it informative, and we’ll see you next month.

If you would like to schedule an appointment to discuss your Alzheimer’s and Dementia care needs or to set up a free in-home evaluation with one of our nurses, call us today in Potomac (301) 363-2580

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