In 1991, 30 Massachusetts nonprofits approached AARP and the Office of Elder Affairs about providing money-management assistance to seniors. The resulting program helps roughly 1,200 clients per month to handle their finances with less anxiety.Finance, Personal - Massachusetts ; Older people - Finance, Personal

Richard A. Hylan

English

Research Papers in Economics

of Prevention
Ounce
An 
by Richard A. Hylan  •  Massachusetts Money Management Program&Banking Communities 15
Helping the Elderly with Daily Money Management
as many as 7 percent of adults
receiving Social Security benefits have difficulty managing their household finances.
For some, this amounts to no more than an occasional bounced check. But for oth-
ers, the inability to keep track of their household finances may lead to unpaid bills,
undeposited checks, cut-off utilities, bank foreclosure, or eviction. 
If nothing is done about the problem, then guardianship or institutionalization
may follow. Simple money-management issues can snowball and can result in the loss
of elders’ right to make decisions about where they live, what happens to their prop-
erty, and how their money is spent. Although older people turn to social services for
assistance with this and other issues, social-service agencies have not routinely provid-
ed help with money management.
According to AARP,
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Recognizing that service gap,
AARP developed a program in 1981 to
deliver free money-management help
directly to seniors in their homes. A
system of safeguards, including detailed
monthly reporting and third-party
oversight, was created to protect both
the elder clients and the money-man-
agement volunteers. 
In 1991, Mass Home Care, a non-
profit network of 30 elder-service agen-
cies, approached AARP and the
Massachusetts Executive Office of
Elder Affairs about starting a money-
management program in the state. The
program was launched with a grant
from the settlement of a fraud case per-
petrated on a senior and prosecuted by
the Massachusetts Secretary of State.
The grant provided start-up money for
programs at six Mass Home Care
“Aging Services Access Points” in the
Boston area. 
By 1999, 25 agencies had agreed
to sponsor local money-management
programs, making the service available
to seniors in all 351 Massachusetts
cities and towns. Shortly thereafter,
Mass Home Care approached the state
legislature for funding, and today, in an
acknowledgment of the rapidly grow-
ing incidence of financial exploitation
of elders, the effort receives nearly
$900,000 annually in state operating
funds as part of the Massachusetts
Protective Services Program. 
The money-management program
has an active caseload of roughly 1,200
clients per month and has helped more
than 6,000 elders. It is now the largest
program of its kind in the country,
thanks to the spirit of cooperation
among the program’s three sponsors:
Mass Home Care, AARP, and the
state’s Executive Office of Elder Affairs. 
Two Ways to Help Seniors
Recognizing that different people
have different financial needs, the
Money Management Program offers
two levels of service: bill-payer service
and  representative payees. With both
services, trained, supervised volunteers
are matched carefully with clients, tak-
ing both the volunteer’s and the client’s
preferences into consideration. For
example, volunteers can choose the
places they are willing to travel to and
whether to work in the homes of smok-
ers or pet owners. Clients can state a
preference for male or female volun-
teers and can ask for a different volun-
teer if the “chemistry” is not right. The
volunteers, many of whom are AARP
members, are required to maintain
detailed monthly records using an
AARP reporting system. 
For most seniors, the bill-payer
program is the most appropriate serv-
ice. It provides assistance to low-income
elders who are still able to make respon-
sible decisions about their financial
affairs but are unfamiliar with the bill-
paying process and need guidance. The
bill payer helps the client establish a
budget, organize and send out mail,
sign his or her own checks, and balance
a checkbook. 
Representative payees bear a high-
er responsibility for allocation of the
client’s funds than bill payers.
Appointed by a government agency,
usually the Social Security
Administration, the representative
payee administers the benefits of those
who are not capable of making deci-
sions about their financial affairs. (See
the exhibit “One Senior’s Story.”) They
open up a checking account in the
client’s name to pay the client’s bills.
Even though the account belongs to
the client, the volunteer is the only per-
son allowed to sign checks. 
Each month, program monitors
provide third-party oversight and sys-
Everett Donaldson gets assistance with money management from volunteer Julia Chapman in 
West Springfield, Massachusetts.
Recognizing that
service gap, AARP
developed a 
program in 1981 to
deliver free money-
management help
directly to seniors
in their homes.
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tematically review all financial records.
Because representative payees have
ready access to the elder’s checkbook,
they are monitored more frequently
than bill-payer volunteers. For help
with technical matters and policy
issues, the program draws on the
expertise of state and local advisory
councils, consisting of Social Security
managers, bankers, and other business
professionals, plus a variety of advocacy
groups. 
Given the oncoming wave of retir-
ing baby boomers, and given that peo-
ple who are age 85 and older represent
the fastest growing segment of the
country’s elderly population, the need
for money-management services will
undoubtedly increase. Volunteer-based
programs such as the Massachusetts
Money Management Program are a
cost-effective way to promote the
financial security of the elderly.  
Richard A. Hylan is statewide coordi-
nator of the Massachusetts Money
Management Program. He is based at
North Shore Elder Services in Danvers,
Massachusetts.
17
This article was first published in the Federal Reserve Bank of Boston's Communities & Banking magazine.The views expressed are not necessarily those of the Federal Reserve Bank of Boston or the 
Federal Reserve System. Information about organizations and upcoming events does not constitute an endorsement. To subscribe, e-mail bostonfed.publications@bos.frb.org.
One Senior’s Story
Larry is 65 and lives in senior housing in Boston. His health is reasonably good, but his memory has
begun to fail. In December 2003 he was facing eviction because the housing authority suspected that his
daughter was living with him in violation of affordable-housing policy. His phone bill showed more than
$1,000 in calls to places he had no reason to call, and when he failed to pay, he lost his phone service. His
other expenses were also in arrears, his debts were mounting, and his monthly income disappeared at the
beginning of each month because of large withdrawals he did not recall making. His daughter said she was
helping her father manage his money, but Larry was always short of cash and increasingly anxious. For a
while, Larry thought he had withdrawn money and then misplaced it.When it was pointed out to him that
his daughter was stealing from him, he was devastated.
The resident-services coordinator in the housing unit where Larry
lived called Protective Services, the state program charged with investi-
gating abuse of the elderly. Protective Services then referred Larry to
the Boston Money Management Program.
At that point, things began to change for the better for Larry.
Believing that Larry was not capable of making appropriate decisions about his Social Security benefit
check, the Boston Money Management Program contacted the Social Security Administration. Boston
Money Management’s Deborah Grose informed Social Security that she had a volunteer, Jane Brayton, who
was willing to serve as Larry’s representative payee and manage his benefit check. Brayton then opened a
checking account for him, to which she has sole access. Larry’s Social Security check is now deposited
directly into that account, and Brayton pays all his bills and makes sure he has enough money for inciden-
tals.
Although Larry’s daughter doesn’t come around as much anymore, another daughter, after hearing of
the situation, has become much more attentive, visiting Larry on a regular basis.And one by one, Brayton
is getting Larry’s overdue debts either paid or forgiven. Larry has a phone again and has enrolled in a day-
time adult-health program that he enjoys immensely. Now that his money is being used wisely, Larry has
funds he never had before to buy some creature comforts. Brayton says that the look on his face when he
sits in his new La-Z-Boy recliner is indescribable.
Larry is happy with Brayton, too.“She’s good. She takes a lot of pressure off of me,” he says.“She
makes me understand things and takes the worry and pain out of my head.”  
Photograph on page 16 courtesy of the Age Center of Worcester Area
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“She takes the
worry and pain
out of my head.”

An ounce of prevention : helping the elderly with daily money management

http://www.bostonfed.org/commdev/c&b/2006/spring/moneymanagement.pdf

An ounce of prevention : helping the elderly with daily money management

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