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Helping Make Financial Plans for Alzheimer’s Patients

Financial matters can be difficult for even the sharpest minds. It’s not hard to understand how someone with Alzheimer’s Disease can struggle with finances, even in early stages. In fact, difficulties with managing money are one of the first signs of Alzheimer’s. If your parent is having trouble paying bills, taxes, counting change, writing checks, or swiping a credit card, it may be time to consider getting them assistance with daily and periodic financial activities.

While many see managing their own money as a sign of independence, it will become necessary to assist your parent as the disease progresses. It’s recommended that you begin putting financial plans in place as soon as possible after diagnosis. Coming up with a plan sooner rather than later is one of the best ways to protect your loved one’s dignity and finances.

  1. Creating a Financial Plan of Care
  2. When your loved one is first diagnosed, the cost of future care may not come to mind right away. Dealing with financial issues and Alzheimer’s can be stressful, but it’s important to begin planning as soon as possible to provide your parent with the care they need and to give you peace of mind. Consider the 5 points below when creating a financial plan of care for your loved one.

    Gather Key Documents for Your Loved One

    According to the Alzheimer’s Association, you should begin to compile the following documents:

    • Bank and broker account information
    • Insurance policies
    • Deeds, mortgages documents, or ownership statements
    • Recurring or outstanding bills
    • 401(k) and 403(k) plans, pensions, and other retirement documents
    • Social Security and Medicare documents
    • Stock and bond certificates
    • Any other monthly incomes (rental property, sales of stock, interest, etc.)

    While inventorying key documents, it’s a good idea to set up automatic bill payments to ensure payment are made on time as you begin to assist your loved one with their finances. Having trouble finding all necessary documents to make payments? Contact a professional financial or legal adviser to assist you. They can also help you with identifying documents that are not in place yet. When in doubt, reach out and ask an expert.

  3. Create or Modify Legal Documentation
  4. Unfortunately, Alzheimer’s is a progressive disease, which is why it is important to start forming a financial plan of care early. Establish who will make decisions on your loved one’s behalf before they are no longer able to make decisions in their best interest. Documentation should include:

    • Living Will – Communicates how your loved one wishes to receive medical treatment toward the end of life.
    • Will – Provides instructions on how to divide assets and determines an executor to ensure all of the patient’s wishes are carried out.
    • Power of Attorney – When a person becomes unable to make decisions on their own, this document grants Power of Attorney to allow another to assume the role of legal decision maker.

    Before putting these document in place or modifying existing ones, you should consult with an attorney. Contacting an attorney, especially one who specializes in elder law or estate planning, should help you to avoid expensive or lengthy legal proceedings later.

  5. Consider Insurance Options Available
  6. Check out financial resources available to help cover future costs. Some resources may be helpful now, and others may be more beneficial down the road. Types of insurance that may assist your loved one include:

    • Medicare – The primary source of health care for individuals over 65. However, other types of insurance may be in effect. Your loved one may also have to supplement Medicare with Medigap coverage. Learn more about Medicare.
    • Long-term Care Insurance – This usually needs to be in place prior to the Alzheimer’s diagnosis. Review your loved one’s policy carefully to find out what their insurance can cover.
    • Life Insurance – Depending on your situation, it may be possible to borrow from a life insurance policy’s cash value, receive a viatical loan, or acquire accelerated death benefits.
    • Medicaid – A state-administered program to assist those with low income. Learn more about Medicaid.
    • Veterans Benefits – Those who have served in the military may qualify for government benefits. If your loved one is a veteran, find out more about the aid they could be eligible to receive.

  7. Adjust Your Loved One’s Portfolio
  8. Your parent may have had different financial goals before being diagnosed with Alzheimer’s. Now that their retirement funds will probably go to their care rather than travel, property investment, or inheritance, it’s time to consult a financial planner to help evaluate and adjust their portfolio.

    Trusted IRAs are an option to consider. If your loved one becomes unable to make decisions, the trustee can step in and take over the investment of assets and distribution of benefits on their behalf, ensuring that their IRA won’t be in limbo until a guardian is appointed. Depending on your loved one’s situation, having a trusted IRA can give them confidence that their heirs will be taken care of properly.

  9. Focus on the Patient’s Safety
  10. Naturally, you’ll be monitoring your loved one’s safety, but that also includes their financial safety. Have they started making large, unnecessary purchases or donating money to questionable charities? Watch out for their safety and adjust documents as needed. Remember, you can always utilize the National Do Not Call Registry to keep telemarketers and scammers from tricking your loved one into giving out information or money unnecessarily.

    Depending on how your parent’s condition advances, provide information as needed to keep them comfortable. If they are unable to handle financial matters but still worry, simply assure them that you and your family have a plan in place with their best interests in mind. When you go out with your loved one, give them a few dollars to put in their pocket and encourage them to spend it.

Handling your loved one’s finances is not an overnight process, but it is necessary to ensure they receive the care they need. Start as soon as possible so you can begin gathering the documentation and experts you need to keep your loved one with Alzheimer’s financially secure.

Considering receiving in home care as a part of your plan to provide for your loved one? Contact us today to see what services are available in your area and what financial options can help cover the care your loved one needs.

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