Five Tips for Financial Planning in the Wake of a Dementia Diagnosis

(5 Minute Read)

Because dementia is progressive, there needs to be some consideration taken for what the future may hold. Medication and treatment can help to manage and even prevent later stages. However, one of the first and most important decisions needs to revolve around financial planning and security. Here are five tips   to   keep you and your loved ones safe when it comes to money following a dementia diagnosis.

Have a Conversation

Though it may be painful, there needs to be a frank and honest discussion regarding the financial future of an individual with dementia. Things may become difficult at a much faster rate than one may expect, so sitting down and finding out your loved one’s wishes for future care and living situations is important. The patient should understand that certain tasks like paying bills and money management may need to be taken over by a trusted family member or loved one.

Compile Current Financial Responsibilities

Once you’ve begun having this conversation, set aside time early after the diagnosis to take stock. Look at the current state of finances, confirm any outstanding debts or loans, and consult with a planner who can help you to know where you stand. This process may actually be a good thing, as there may exist unclaimed money or property that can be sold.

Gather All Necessary Documentation

There are many legal and financial documents that will need to be collected, so as to prevent any confusion in case the disease progresses faster than expected. Make sure any living wills, medical and durable powers of attorneys, and last will and testaments are completed. From a financial point of view, be sure to have banking and brokerage information, all deeds and mortgage statements, a full list of relevant insurance policies, summaries of pension and retirement benefits, Social Security Benefits, and any other source of monthly or yearly income.

Consider Costs of Treatment

As you continue to devise a long-term budget, you’ll need to give a great deal of thought to what additional costs may stem from this disease and any surrounding complications. Alzheimer’s can progress rapidly and can require unforeseen rounds of treatment that may not be covered by insurance. Creating a financial plan for a patient with dementia should include considerations for prescription drugs, personal care supplies, the possibility of adult day care providers, in-home services and the cost of live-in caregivers, and full-time care facilities.

Understand Resources

Figuring out how to pay for these expenses might seem overwhelming. Thankfully, though, there are several options for financing the future of an individual living with dementia.

  • Insurance Types

There are important distinctions in coverage between government-provided programs like Medicare and Medicaid, and more flexible options like private health insurance. Make sure you check with your agent or State Health Insurance Assistance Program for free help in understanding which plans work best for you.

  • Selling a Home or Vehicles

Because it may be necessary for a dementia patient to relocate and live with family or in a facility, you may consider selling their home to help cover costs of treatment. Additionally, as the disease progresses the individual will likely be unable to drive, meaning selling a car might be an option.

  • Investments

Safe investments like stocks and bonds can help to provide a steady stream of income without jeopardizing financial security.

  • Life Settlement

One of the best ways to pay for treatment or create a nest egg is to  sell the  life insurance policy for a cash settlement. By partnering with the right team, you can be sure that the policy will produce the highest lump sum possible, and thereby provide you and your family with breathing room.

The diagnosis of dementia is difficult. However, it’s vital to take concrete and measured steps to ensure that all treatments and upcoming expenses are paid for. By having tough conversations, assembling a comprehensive overview of all current finances, gathering necessary documents, considering the costs of treatment, and seeking out every possible way to maximize a budget, you can focus on making certain the best care and quality of comfort is available for the individual suffering. It’s also important to educate yourself as much as possible which is why we created this e-resource, Causes of a Dementia Diagnosis and the Early Warning Signs You Should Know.

Leo LaGrotte
Life Settlement Advisors
llagrotte@lsa-llc.com
317-863-5936

Download our free resource, Causes of a Dementia Diagnosis and the Early Warning Signs You Should Know, to educate yourself to spot dementia before it arrives.

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