I hope the time you spend with your loved ones this holiday season is filled with delicious food and happy memories. But sometimes the holidays can bring to light concerns in those you don’t get to see very often, particularly seniors.
How to Spot the Start of Memory Issues
The Institute for Dementia Research & Prevention estimates that one in six women and one in ten men who live past the age of 55 will develop dementia in their lifetime. That doesn’t mean you should panic if you notice your loved one having trouble recalling events or difficulty concentrating – these can be signs of normal aging, along with a gradual loss of hearing, sight, and taste. However, if you notice some of the symptoms of mild cognitive impairment below, it might be time to consider planning for a time when they may not be able to handle their own finances.
- A level of progressive forgetfulness that is noticeable to others and seems higher than normal.
- Losing things often.
- Having difficulty recalling words or names.
At this stage, your family member may still be functioning independently and may be able to perform day-to-day tasks such as meal preparation, housekeeping, telephone use, driving, and medication management on their own. (If this is not the case, there could be a higher level of impairment already associated with dementia. Once memory lapses affect daily life, it may be a symptom of mild to moderate dementia.)
Determining Financial Incapacity
Dementia can affect a person’s ability to manage their personal financial affairs. The determination of financial incapacity is usually made by a physician, however, family members need to know when a trip to the doctor is needed. Waiting too long to obtain the evaluation may have serious consequences. Seniors can become victims (one in five people over the age of 65 have been victims of financial fraud), or they may be too impaired to execute important legal documents. It is important to spot and have cognitive difficulties assessed before significant dementia develops.
When trying to understand if someone is facing financial incapacity, there are three types of knowledge you can reference to get a sense of whether or not an evaluation is needed:
- Declarative Knowledge: the ability to describe financial terminologies.
Question: Can they name coins and currency?
- Procedural Knowledge: the ability to perform tasks that are related to money.
Question: Are they managing their checkbook properly?
- Judgment: the ability to make sound decisions regarding finances.
Question: Are they making sound investment decisions?
Significant challenges associated with their knowledge of financial terms, tasks or their judgment, should trigger an evaluation by a physician.
6 Steps to Take When Memory Issues Begin
Losing the ability to manage finances can be a slow process, with good days and bad days. You may worry about your family member’s financial safety and want to “take away the checkbook,” but while seniors may be vulnerable, they still want to be in control of their finances. You can help by utilizing tools to make things easier during the early days of cognitive impairment. Here are six things you can do to protect your loved one and help them stay involved in their financial life for as long as possible.
- Make Sure All Legal Documents are in Order
If cognitive decline has started and powers of attorney for medical and financial affairs have not been executed, get the senior to a lawyer as soon as possible. Once a person is no longer deemed to have mental capacity, it may require a lengthy, expensive legal guardianship proceeding that will allow a trusted person to manage the senior’s affairs.
- Get Your Power of Attorney on File
If you have been named as legal agent under a power of attorney, get your power of attorney document on file with banks, insurance companies, and other institutions that may not communicate with you without it. Sometimes this process takes weeks (due to an internal legal review process) and it can be very frustrating if you have to do this during a crisis. You may not exercise all of the powers granted to you right away, but you will be glad that when the time comes, the document is already on file.
- Create a “Cheat Sheet”
Even when a senior has some difficulty remembering information, they may still be able to make financial decisions or give permission for you to speak on their behalf. Make the senior a “cheat sheet” with their key information (date of birth, social security number, address (including zip code), mother’s maiden name, etc. Write it out big and bold so it will be easy to read and have it on-hand before you call financial institutions, insurance companies, or service providers. Hide it or lock it up when you are done, especially if the senior has caregivers and other service providers coming into their home regularly.
- Write Notes Directly on Correspondence
If you help with paperwork, write any notes directly on the bill or letter, such as the date, who you spoke to, and the outcome of the call. Seniors will often review the documents you processed with them but won’t remember the action and outcome, and it may lead to unnecessary anxiety. Having written notes will jog their memory.
- Leave Reminders
Put a sticker on the checkbook reminding them not to give out their account information over the phone. Put another one on or near the phone with the same reminder.
- Request Copies of Checks
Ask their bank to include copies of checks on any paper statements. There may be a small fee involved, but it is worth it. For seniors who are beginning to have cognitive difficulties, they often “mess up” the checkbook. A more reliable record of the debits and credits on the account will come from the bank.
How One of These Steps Helped My Client
Mrs. R was 95 years old and had significant dementia, but she always had a great sense of humor. When I first started with her, she was just 88, but even back then, she had short-term memory loss. Although she had a power of attorney, the agent was not yet activated, and I was still working with her directly, having her sign her own checks. The problem was that she couldn’t remember how much money she had, so she fretted about signing each check. She had over $2 million in the bank, but she worried about every $10 spent, simply because she couldn’t remember.
I needed a way to remind her that she had that money. She was perfectly capable of reading and comprehending, so I created a sheet on which I wrote some key information about her situation, including the fact that she had $2.3M in the bank. When I first showed her the sheet I created, I said that I did it because she has a bad memory.
“I have a bad memory? Oh, I forgot that I have a bad memory!” she laughed.
Each time Mrs. R saw that note, she would laugh and say, “I have that much?!” and then would happily sign checks.
These little things can do a lot to make seniors more confident in their everyday efforts and to feel that they are still in control of their finances. They will also help you to breathe a little easier knowing that these important concerns are being addressed.
Have questions about daily money management or our services? Please contact us here.