Going to the doctor to discuss concerns of your senior loved one’s memory impairment and learning they have Alzheimer’s disease is something caregivers dread.
No one wants to believe it is happening to someone we love.
There are actions you will want to take after you come to grips with the diagnosis.
High among those actions is addressing your senior’s financial matters.
After the Diagnosis
Once your senior loved one is diagnosed with Alzheimer’s disease or other dementia, it is time to make some plans for the future.
We have a variety of informative tips for you in our post After Alzheimer’s Diagnosis: Family Caregivers Planning for the Future but now we will focus on finances because of its importance.
The first step in protecting financial accounts of someone with Alzheimer’s or other dementia is to create legal documents while they are still legally competent to execute them.
Yes, “legally competent” sounds harsh and impersonal, but it’s one concept with which family members of a senior with Alzheimer’s need to become familiar.
It is important that a durable power of attorney which includes finances and healthcare is created so that there will be a person designated to act on behalf of your senior loved one at the time they are no longer capable of managing their money.
Who Should Make Decisions?
It may be difficult for your senior to decide who is the most appropriate person to make decisions for them when the time comes.
Who do they trust with their money?
Who will be in the best position to do what is needed?
Who can they depend on to honor their wishes?
The person they choose ideally should live nearby and not be a long distance caregiver, if possible, because of the need to act quickly and be available if needed to sign paperwork, be familiar with the financial institutions or oversee an issue.
Yes, much today can be done electronically, but there are still benefits to being physically available.
This person doesn’t have to be a family member. A close friend or advisor will work as well.
It is very important for your senior loved one to be clear, open and honest about their wishes from the beginning so that their proxy can follow their wishes without any confusion. Remember that your senior loved one is proud and won’t want to be viewed as out of control of their abilities.
This person should also be told the details of your senior’s finances, such as where all accounts are located (banking, stocks, trusts, etc.), any passwords if banking done online, all retirement fund information, insurance policies, elements of their will, which bills need to be paid from the account and how they get paid, and where the paperwork can be found in the home. For example, are the statements received in paper form or online? Can the proxy access these statements?
Signs Your Senior Can No Longer Handle Money
How do you know when your senior loved one with dementia is no longer able to handle their own finances, pay their own bills, or is incapable of accessing their financial accounts?
Managing finances is often one of the first skills of daily living that seniors with dementia lose as the disease progresses. Unfortunately, people with dementia are also targets of criminals looking to gain easy access to their money.
There are some signs to be alert to as a caregiver so that you will be able to step in and protect their finances:
- Difficulty counting change
- Trouble calculating the tip
- Buying unnecessary items perhaps expensive ones
- Giving excessive donations to various causes or people
- Overdue bill notices or bank overdrafts
- They look for missing money from wallet or accounts
- Paranoia about funds, accusing others of stealing their money
- They avoid handling money or accounts
How Caregivers Can Protect Loved Ones’ Finances
It is important that family caregivers realize there will be a problem for the person with dementia handling money. It may not be right now, but it will come.
Sometimes caregivers don’t see the problem when it first strikes because the person with dementia is good at hiding their failing capabilities. They are often afraid of being caught not remembering or knowing how to do a task so will try to keep it a secret, oftentimes until it is too late and the money is truly missing.
To protect their money and keep them safer from people who want to defraud them, there are a few steps caregivers can take:
- A caregiver, especially if they are the power of attorney for finances, should be monitoring the accounts. A person can be designated to keep tabs on a bank account as a third party, read-only status without ability to access the account. This is a good middle step towards taking it over altogether but allows the caregiver to see what is coming in and going out of the bank accounts. You can talk with your senior’s bank about this plan.
- It is a good idea to discretely identify your senior loved one as a person diagnosed with dementia with the appropriate person at the bank. It is not uncommon for bank tellers to be the first ones to spot financial abuse of seniors. Once you tell the bank about the dementia, you can discuss the options they can take and with which you can assist to keep their money safe.
- Your senior can put a freeze on their credit report so no one can fraudulently set up new credit cards or steal their identity and give the unfreeze code to a trusted someone. Read their credit reports at least annually to be sure there has been no fraudulent activity in their name.
- Place your senior’s phone number on the national Do Not Call registry to reduce the likelihood of them getting scammed over the phone.
Uncomfortable Conversations May Be Needed
It is true that many families, especially older adults, don’t like to discuss their finances, but once a diagnosis of dementia occurs it is important that caregivers be informed about finances and take steps to be in control of documents and passwords so that they can monitor the safety of the money!
It might be a good idea to have seniors work with a financial adviser if they don’t feel comfortable talking about money with you. The adviser can oversee their accounts too but don’t have the family connection. Be sure to choose one that is reputable.
It will be helpful to discuss all the options and decisions while your senior is still mentally competent and put plans in place for that time in the future when help will be needed.
Uncomfortable though it may be, protecting your senior’s money up front is easier than trying to recover funds after some unscrupulous person victimizes them.