Daily Money Managers for the Average Jill or Joe

Nobody likes paying bills, reconciling his checkbook or scrutinizing credit card statements for identity theft and fraud.

Now there's an alternative: the daily money manager, or DMM.

Daily money managers began cropping up across the country in the past decade to take on the tedious monthly bills and paperwork for busy baby boomers, their aging parents and people with disabilities. For an hourly fee, they will pay your bills, make bank deposits, balance your checkbook, organize your tax information, negotiate with your creditors and provide referrals to accountants, lawyers and financial planners.

Sally Hurme, attorney for consumer protection at AARP in Washington, D.C., says the relatively new industry is a reflection of the ongoing historic intergenerational transfer of wealth between the World War II generation and the boomers.

"There's no question that boomers have a lot of money, and they're going to want to manage it wisely -- and they're going to need help in making sure that their money lasts. We just want to make sure that we get good help instead of help from vultures," says Hurme.

Pat Manalio, a DMM and spokesperson for the American Association of Daily Money Managers, says the nonprofit organization now has about 500 members and is growing at a rate of five new members per week. The AADMM, based in Woodbridge, Va., was founded in 1995 by a group of daily money managers who saw the need to promote best practices and a code of ethics within their unregulated industry.

Most daily money managers acquire new clients through referrals from accountants, lawyers, financial planners and healthcare professionals, hence their relatively low public profile.

"We're not trying to be the world's best-kept secret, but would you respond to an ad in the paper from somebody saying, 'I'll handle your money for you?'" Manalio asks. "I wouldn't waste my money advertising that way."

Here's a look at the little-seen world of daily money managers and how to find one, if and when you need one.

Help for the Elderly
Older Americans struggle on several fronts with money management. For some, physical conditions such as arthritis make such rudimentary tasks as writing checks and opening the mail difficult, while others have cognitive challenges, including dementia, that cloud thinking. Confusion and disorganization can quickly follow.

Today, many, if not most, elderly also are drowning in official-looking solicitations for credit cards, insurance, fraud protection and financial assistance from every institution in which they have an account. What once was a prudent move, opening accounts in several banks, has turned into the junk-mail nightmare on Golden Pond.

"All the junk mail looks so official these days," says Anita Matson, a DMM in Kent, Wash. "I try to simplify things and get things on automatic payment to make it as simple for my clients as possible."

Matson, a retired elementary school teacher, became a daily money manager two years ago after helping family members sort out their personal finances. She charges $40 an hour, and spends, on average, one or two hours per month with her mostly elderly clients in their homes.

In addition to the labyrinth of Medicare, Medicaid and private insurance bills to sort through, Matson spends a good deal of time explaining statements to her clients.

"Things have gotten so complicated financially, with the way that financial statements come through," she says. "I help people check their medical bills and make sure they are getting reimbursed properly."

Matson is careful to maintain her role as adviser and will not become a signer on her clients' accounts. Liability insurance, she notes, is very pricey for daily money managers.

"My clients actually sign their checks, or in some cases I work with their relative who has durable power of attorney. I don't want to have fiduciary powers," she says.

Aging in Place
When money is only part of the aging issue, a more holistic approach may be called for. That's when a more specialized version of daily money manager known as a geriatric care manager, or GCM, can help.

"The distinction for GCMs is their goal to help people remain independent for as long as possible," says Patricia Morris, a GCM in Newton, Mass. "It takes knowledge of aging issues. It's a very different focus."

Morris became a GCM two and a half years ago. She holds a law degree, a master's degree in counseling and is a certified financial planner. She charges $60 an hour for a range of services, including financial counseling.

Geriatric care managers often come out of a health care or elder services background and can make recommendations on elder care and aging-in-place issues, in addition to providing money management assistance.

Families typically call on Morris for help when an elderly parent or relative has inadvertently caused a financial calamity.

"When they write checks more than once for the same bill or they don't write checks at all, that's a sign," she says. "And medical bills can be a real problem, especially when one spouse is trying to take care of the other."

A geriatric care manager is often the individual's last hope for financial independence before a family member steps in or a court-ordered conservator is appointed to tend to their affairs. If the Social Security Administration deems it necessary, it will appoint a representative payee to receive the benefit checks on behalf of the individual and manage that portion of a person's assets. The Veteran's Administration similarly may appoint a federal fiduciary to manage an individual's pension if the veteran is unable to do so.

Money management assistance is available free of charge to low-income seniors through the AARP-sponsored money management program, which gives volunteers the software tools and supervision to help with routine tasks. Consult your state Agency on Aging or www.aarpmmp.org for more information.

Where money and the elderly are concerned, the conundrum is this: How can the elderly avoid being victimized by con artists posing as daily money managers?

"There clearly is a need and there clearly is a risk," says Hurme. "Any time you're putting your money in the hands of someone else, you need to be very certain of the ethics and qualifications of that individual. You want to be sure that they know their fiduciary responsibility."

The best way is to seek referrals from relatives and friends, as well as doctors, lawyers, accountants and social workers in your community. A state-by-state listing of AADMM members, as well as helpful guidelines and questions to ask a prospective daily money manager, are available on the association's Web site.  If a geriatric care manager more closely fits your needs, you can get helpful information from the National Association of Geriatric Care Managers.

Too Busy for Bills
Pat Manalio's clientele at Strategic Financial Services of Lakeridge, Va., is predominantly busy professionals and small business owners for whom her time, at $60 an hour, is money well-spent.

Manalio says her time commitment to her busy professionals far exceeds the time she spends with her few elderly clients.

"With the elderly, I might spend one hour a month; with the professionals, I have one client that I spend about five hours a week doing both their business and personal money management," she says. "The seniors sometimes just want you to write the check and reconcile the checking account. With the busy professionals, you're getting stuff together for their tax accountant; you're giving them reports. They want to know how they're spending their money in many cases."

Busy professionals, says Manalio, have come in all shapes and sizes during her nine years in the business. At one point during the dot-com era, she even assisted two 16-year-old whiz kids.

"The parents called me because the kids wouldn't let them into their finances," she chuckles. "The kids were doing pretty well, but they were too young to sign checks."

Surprisingly, she prefers clients who take an active interest in their money flow to those who would rather not bother.

"I find that the ones that just want it off their plate are very difficult to work with because they're usually in over their heads financially and what they really want is not to know that they have these bills," she says. "They want you to fix the problem and make it go away. But I can't make more money for them or spend less for them. I'm not a magician who can wave my arms up in the air and make more money appear. I would not be working if I could."

Jay MacDonald is a contributing editor based in Mississippi.

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