On March 15, 2018, the Fifth Circuit Court of Appeals ruled that the United States…
The onset of Alzheimer’s Disease or Dementia reduces brain function, which can in turn lead to making poor financial decisions on your own behalf. If you are 50 years old or greater, having easy access to your financial assets – like stocks and bonds, checking and savings accounts, money market accounts, and other assets – can lead to loss of these funds if an unauthorized person gains access to them, or if they are mismanaged.
Family members are often unaware their loved one needs help before the unintentionally mismanaged assets, now gone, bring about devastating consequences for both the person living with dementia as well as their family. The Alzheimer’s Association reports that from diagnosis to death, Alzheimer’s disease (AD) care will cost an average of $424,000 per individual, and 70 percent of that cost is out of pocket expenses to the family system of the affected loved one.
Signs of Alzheimer’s Disease or Dementia to Look For
It is common to have AD symptoms long before an official medical diagnosis. Difficulty managing money is one of the first signs of Alzheimer’s disease. To spot problems early, look for the warning signs of ill-advised financial transactions through oversight.
Unopened or unpaid household bills, overspending on credit cards and making just minimum payments on the debt, falling prey to frauds and scams, and not paying attention to more significant investments that constitute the bulk of a person’s wealth are all indicators of mental decline. As a whole, the situation is very concerning as the poor financial outcomes that asset spending brings about are also happening at a time when expenditures to pay for increasing caregiving needs for dementia becomes extensive.
Alzheimer’s Disease and Dementia Care are Costly
Projections are that by 2050, the prevalence of Alzheimer’s will triple in the US. Those individuals suffering from AD who do not have personal or family financial support will most likely become a beneficiary of the US Medicaid program. Total Medicaid spending in the fiscal year 2018 was 593 billion dollars. The federal government paid 62.5 percent, and the states paid 37.5 percent of the budget. Research statistics data from the Centers for Medicare and Medicaid Services (CMS) are projecting that, under current law, from 2018 – 2027 national health spending will be nearly 6 trillion dollars with a substantial portion of that going to underfunded seniors living with dementia.
One of the best ways to protect your finances from the unintended consequence of mismanagement due to cognitive impairment is to accept that this problem exists, and there is a need to put systems in place for financial oversight long before mental decline sets it. Meet with an elder law attorney to put the legal documents in place, allowing for power of attorney, financial control, medical power of attorney, as well as a dementia directive, as early as your 50th decade. You may also allow a trusted adult family member, friend, or financial advisor to review your monthly spending habits and bill paying. If there is a noted error in your financial judgment or a lapse in your standard financial operating procedures, they can call it to your attention well before all of your money is gone.
If you have questions or need guidance in your planning or planning for a loved one, please do not hesitate to contact our office at (248) 577-9933.