Guide to Financial and Legal Planning Resources and Assistance for Seniors with Alzheimer’s

When a loved one receives a diagnosis of Alzheimer’s disease, it’s natural to worry about their quality of life. Alzheimer’s and other forms of dementia cause memory loss, confusion and difficulty organizing thoughts, which can interfere with activities such as preparing meals, caring for pets and performing grooming and health-related activities. A senior with a recent Alzheimer’s diagnosis may also experience feelings of anger, resentment and fear as they think about how their lives are likely to change.

The physical and emotional challenges of dementia are well-publicized, but what many seniors and their loved ones don’t realize is that Alzheimer’s disease has a significant financial impact. Seniors with Alzheimer’s and other forms of dementia may need to hire in-home caregivers or consider residential care as the disease progresses. They may also need expensive medications to prevent their symptoms from getting worse, increasing their out-of-pocket medical expenses.

Although you can’t reverse Alzheimer’s disease, there are many things you can do to prepare for a potential diagnosis or reduce the impact of a recent diagnosis. One of those things is having your legal and financial affairs in order. This guide offers planning tips for seniors with dementia and their caregivers, describes some of the resources available to help make the costs of Alzheimer’s care more manageable and provides an overview of the legal and financial documents you need to protect yourself and the people you love.

As you engage in the planning process, you’ll need a variety of documents to make your wishes known and ensure that the decisions you make are legally binding in your state. The infographic below provides an overview of the most common legal, financial and health care documents used by people with dementia who want to prepare for the future.

When it comes to making health care decisions, no two people are exactly the same. That’s why you need to make your wishes clear to loved ones and your medical care team members. Advance directives are written documents that outline your wishes regarding medical matters. The legal requirements for advance directives vary based on state law, so it may be helpful to consult an attorney who has experience preparing these documents for seniors in your state.

Advance directives typically have two components: a living will and a durable health care power of attorney. A living will may contain instructions regarding the following:

A durable health care power of attorney names someone to make medical decisions on your behalf if you become unable to do so. This person is known as your health care proxy. When you select a proxy, choose someone who understands your wishes and is willing to make decisions based on your values, not theirs.

Physician orders for life-sustaining treatment and medical orders for life-sustaining treatment support the wishes outlined in your advance directive. Medical professionals will issue them, ensuring that everyone involved in your care is aware of how you feel about CPR, feeding tubes, mechanical ventilation and related issues. 

A DNR order indicates that you don’t want members of your care team to use CPR or other methods to restart your heart if it stops beating. Although you can spell out your wishes regarding CPR in your living will, a DNR order offers an extra layer of protection. If you have a medical emergency and the responding staff member doesn’t have your living will on hand, they can look at the DNR order in your hospital room to determine your wishes regarding resuscitation.

Once you document your wishes regarding medical care, you need to work on financial and estate planning. Financial planning helps ensure you can continue paying your bills even if your symptoms progress. You’ll also have the opportunity to designate someone to make financial decisions for you if you become incapacitated. Estate planning ensures that your executor distributes your property according to your wishes. It can also help you minimize the tax consequences of certain events.

Getting a diagnosis of Alzheimer’s disease can be overwhelming, but careful planning can help you ensure your wishes are followed when it comes to medical care, financial decisions and the distribution of your assets. When you’re ready to begin, follow these tips to make the planning process as easy as possible:

• Start early: Planning as soon as possible can help ensure that you have your documents in order before your symptoms progress. Talk with family members, health care professionals and attorneys to ensure you document everything in a way that’s valid in your state.
• Gather important documents: Your attorney may need to see copies of insurance policies, investment account statements and other documents to help you make wise decisions. Gather these documents and keep them together in a safe place in case you need to refer to them during the planning process.
• Review your plans regularly: Your circumstances may change after you do your initial planning. To ensure your legal, medical and financial documents always reflect your current situation, review your plans regularly. For example, if your health care proxy becomes ill, you may need to select a new one. You may also need to update your will to include property you acquired after your attorney prepared the original one.
• Make funeral plans ahead of time: No one likes to think about their own funeral, but it’s important to make funeral and burial plans when you can. You may want to buy a casket or cremation urn ahead of time, arrange your burial in a family plot or choose which photo you want to display with your obituary. Let your loved ones know if you want a memorial service or if you’d prefer they pay their last respects in private. You can even document what kind of flowers you’d like to have or what songs you’d like the mourners to sing.
• Look into senior care: You may not need care when you’re first diagnosed, but your needs can change as you age. If you want to stay in your home, you may arrange to have a family member move in with you or check on you daily. Paid caregivers are also an option, especially if you need in-home nursing care or physical therapy. If you don’t want to worry about maintaining a home, consider moving to a senior living community. While you’re planning ahead, tour local communities, ask questions and determine which one you want to move to if it becomes necessary.

The requirements for legal documents vary from state to state, so what’s valid in one location may not be valid in another. Online forms help determine what you need to think about as you engage in the planning process, but they can be difficult to understand. You may even download forms that have legal errors in them, rendering self-prepared documents invalid in your state. It’s best to work with someone with the knowledge and professional experience to help you avoid legal pitfalls. The following people may be able to help:

As your needs change, you may need to hire paid caregivers, move to a residential community or make other decisions that cause your expenses to increase. It can be difficult for some seniors to afford these changes, especially if their medical expenses have increased due to an Alzheimer’s diagnosis. The programs and resources below can help you cover the costs of some of your care, leaving you with more money to pay for other expenses.

Medicare is a health insurance program designed for seniors 65 and older. You may also qualify if you’re under 65 and have a disability. Original Medicare has two parts: Part A (hospital insurance) and Part B (medical insurance).

Medicare Advantage is an alternative to Original Medicare. The main difference between the two is that Original Medicare is a government-administered insurance program, while private insurance companies throughout the United States sell Medicare Advantage Plans. With a few exceptions, Medicare Advantage Plans must cover the same basic services as Original Medicare. Insurers can also offer extra benefits, giving Medicare Advantage enrollees additional flexibility.

Medicaid is a health insurance program for enrollees with limited financial resources. It covers many mandatory benefits, including doctor visits, X-rays, lab tests and inpatient hospital care. Depending on where you live, your state may also offer optional benefits, such as prescription drug coverage.

SSI provides cash payments to seniors with limited financial resources. You may qualify if you’re at least 65 years old or blind or disabled. You must also be a U.S. citizen or qualified immigrant residing in the United States.

SSDI provides cash payments to disabled individuals who’ve worked and earned credits by paying Social Security taxes. To qualify, you must have a disability that meets the Social Security Administration’s strict guidelines.