People with Alzheimer's disease or other dementias often have trouble managing their money. Research shows that money problems may be one of the first noticeable signs of the onset of the disease.
In the early stages, a person with dementia may be able to perform basic tasks, such as paying bills, but is likely to
Expect to have trouble with more complicated tasks, such as balancing their bank account. As the illness worsens, the person may try to hide their financial problems to protect their independence. The person may also not realize that they are losing the ability to handle their finances.
Signs of financial problems
Look for signs of problems with money, such as problems counting change, paying for a purchase, calculating a tip, balancing a checkbook, or understanding a bank statement. The person may show signs of fear or worry when talking about money. You may also find the following signs:
– Unopened and unpaid accounts
– Many new and unexplained purchases on the credit card
– Unexpected new merchandise at home
– Large unexplained deficits in the person's bank account
A family member or legal representative should review bank statements and other financial records monthly to see how the person with dementia is doing and intervene if necessary and if these documents raise serious concerns about unwise financial dealings. This can protect the person from becoming a victim of abuse, financial blackmail, or fraud.
Taking preventive measures at an early stage
It is understandable that many older adults will be reluctant to have someone else take control of their financial affairs. To provide support while respecting the person's independence, a family member or trusted friend can do a number of things to help the person with dementia while respecting that person's independence and autonomy:
– Start a conversation about the importance of a monthly budget. Help the person write a clear financial plan. If the person is digitally literate and can easily use a computer or smartphone, share information about secure online budgeting tools, many of which are free.
– Set up automatic bill payments. You can arrange for utility bills, mortgage, rent, and other expenses to be paid through automatic deductions from your bank account. This payment method will ensure that bills are paid correctly and on time.
– Discuss different ways you can help manage expenses. Consider giving the person small amounts of money that they can
Keep it handy, reduce your credit card spending limit, and cancel credit and debit cards
Unnecessary.
– Offer to do the grocery shopping for the person or use the supermarket delivery service to reduce overspending and ensure the person has what they need at home.
– To prevent serious financial problems as the illness worsens, you may need to take responsibility for the person’s financial affairs through legal arrangements. It is important to handle the transfer of financial authority with understanding and respect for their situation.
You can arrange to manage the person's finances through a durable power of attorney for financial matters, preferably while the person can still understand and approve the arrangement. To get started, consider taking the following steps:
– Agree on how to manage finances. To avoid serious problems, make it easier to transfer responsibility to a legal representative, called a power of attorney, who will have the authority to access and manage the person’s financial affairs. A lawyer may not be required to set up a power of attorney, but they can provide guidance and advice if needed.
– Plan for long-term care costs. Consider options for home help, such as a foreign worker or an hourly caregiver. Find out what the costs of home or institutional care are and how much of these costs are covered by the state, long-term care insurance, or workplace insurance. If the person needs additional care, they may move into an institution or protected community, such as an assisted living community or nursing home.
– Gather important papers and discuss financial and estate planning. Gather the person’s important records and documents in one place. Basic papers include the person’s birth certificate, insurance information, and bank records. These papers should also include the person’s will and any medical or financial directives they have given in advance to ensure that their wishes are respected.
Protecting people from financial abuse and fraud
People with dementia may be easy targets for financial abuse or fraud. Sometimes, the person behind the fraud is a stranger. But financial abuse and fraud can also be perpetrated by a friend or family member. Phone, email, or face-to-face scams in the person's home can take many forms, such as:
– Identity theft
– Get rich quick suggestions
– Fake offers of prizes or home or car repairs
– Insurance fraud
– Government impersonator scams
– Health scams, such as ads for unproven memory aids
– Threats or intimidation
Look for signs that the person with dementia may be a victim of financial abuse or fraud. For example:
– Signatures on checks or other papers do not look like the person's signature.
– The person’s will was changed without permission.
– The person's house was sold, and they did not agree to sell it.
– The person signed legal documents (such as a will, power of attorney, or a joint deed to a house) without knowing what the papers meant.
– Valuable items, such as jewelry or electronics, are missing from the home.
To reduce the risk of telemarketing schemes and spam calls, block unknown numbers from the person's phone or set the smartphone to not accept calls from unknown numbers.
Consider signing the person up for fraud alerts through their bank, credit card company, or other credit monitoring service.
One reason scammers target older adults is that they are less likely to report suspected fraud.
If you think someone has been the target of fraud, you can contact the Senior Citizens Hotline, *8840, of the Ministry of Social Equality and Pensioners in the areas of elder abuse and consumer fraud.
