After Dementia: Financial and Legal Planning

Ami Noss
By Ami NossSeptember 28, 2016

Alzheimer’s disease, dementia and legal rights have been in the news recently, as high profile figures like 80-year-old Donald Sterling, former owner of the Los Angeles Clippers, and 70-year-old Pat Bowlen, former owner of the Denver Broncos, have relinquished control of their respective teams while battling Alzheimer’s.

Establishing solid financial and legal plans with your loved ones is essential after an Alzheimer’s diagnosis. Learn more about how to plan during this time.

Resigning with Alzheimer’s

Sterling and Bowlen’s end-of-career-trajectories couldn’t be more different, though they have one thing in common: Alzheimer’s.

Sterling, banned from the NBA and subsequently removed from the Clipper’s board of trustees, became engaged in a highly contentious court battle, during his attempts to stop his estranged wife and former co-owner, Shelly Sterling, from selling the team.

Bowlen, by contrast, began quietly handing over management of the Broncos then-team-president Jim Ellis in 2011, when his disease first became a struggle. He formally promoted Ellis to CEO and then stepped away from team management.

While Sterling and Bowlen certainly have differences, their stories clearly illustrate the difference between operating in crisis mode and following a carefully considered course of action.

Preparing for a Future After Dementia

“No one likes to talk about end-of-life care,” says Kim Boyer, founder of Boyer Law Group, who has been practicing elder law for 19 years. “The majority of clients who come to us are dealing with a current crisis for which there’s been no preparation.” No matter what stage you’re in, however, there are several steps you can take to keep you and your family on the right path.

We all hope that we’ll be fortunate enough to avoid mental and physical incapacitation in our old age, but the reality, according to the Alzheimer’s Association, is that “1 in 3 seniors dies with Alzheimer’s or another dementia.”

To create a thorough elder care plan, Boyer recommends the following course of action:

Designate Legal Representatives

To fully protect your interests, you should pre-designate a representative to act in each of the following roles:

  1. Legal Guardianship: A legal guardian will have full control of all of your personal and financial interests, so choose this person wisely.
  2. Power of Attorney for financial matters: You can assign someone the right to make financial decisions for you at a given date, or under circumstances of your choosing.
  3. Power of Attorney for health care: This person will take control of your health care decisions only in the event that you are unable to make these decisions yourself.

Discuss Your Needs and Wants with Family Members

It may be a difficult subject to tackle, but talking with family about what you’d like to have happen should you become incapacitated toward the end of your life can prevent a lot of future stress.

“Being able to say, ‘this is what Mom wanted,’ can relieve a lot of tension for care providers,” Boyer points out. A few things to consider:

  1.  Do you want to live with your family if possible? “For some people the prospect of living in a multigenerational household with lots of family around is pure joy,” says Boyer. “Others would rather do anything but that.” At the same time, it’s a good idea to know ahead of time whether your family will be able to accommodate you.
  2. What are your health care wishes? What interventions do you want or not want under what circumstances? While you can, create formal advanced directives. Although the reality is that these documents may not cover every possible scenario, having an informal conversation about your general intentions can be helpful in the event that caregivers are forced to make less than obvious decisions.
  3. What portion of your finances is to be spent on your care versus left as an inheritance? Again, you can make a formal plan, but it can still be valuable to discuss your intentions with regard to your financial legacy ahead of time.

Get Your Finances in Order

It’s important to figure out how you’ll pay for the care you may need, and to leave a clear working plan for the party or parties who may eventually take over your affairs. Depending on your age and current situation, you may need to:

  1. Consider long-term care insurance. “Lots of people don’t want to spend money on benefits they may never use,” says Boyer, “But there are new products available that convert to life-insurance-like policies, so that loved ones receive a death benefit if long-term care ends up not being necessary.”
  2. Speak with an investment advisor. Chances are good that you’ve already worked with a financial professional to plan for your retirement, but if elder care didn’t figure into your original plan, you may want to sit down with your advisor to re-map your financial strategy.
  3. Take stock of your assets and liabilities. If you’re unsure of your current net worth, this is the best place to start. As you are calculating, make sure to create a master document listing all of your accounts and any associated contacts.

Have you created a financial or legal plan for a loved one after dementia? What was your experience like? Share your story with us in the comments below.

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Ami Noss

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