People in marriages and long-term relationships often divide roles and one person may take on the role of ‘money manager’. If this person has dementia and becomes unable to cope with finances, there can be significant problems. Banks and utility companies e.g. phone, electricity, and water will often only speak with the account holder. If that is not possible, sorting out problems with supply or bill payment can become very stressful. Start to work through household accounts and bills as they come in over the next 12-months. You can telephone or email companies to find out procedures to ensure that you or the power of attorney you appoint can access accounts.
It is a good idea for us all to appoint a trusted person or people to assist or manage our financial and legal affairs if we become incapacitated. A person appointed to act in this role is called a power of attorney. Be aware there are two types of powers of attorney.
- A general power of attorney stops if the person loses mental capacity, so eventually will not be able to act on behalf of a person with dementia.
- An enduring power of attorney continues even if the person has lost mental capacity.
You can appoint a trusted family member or friend, who is over 18 years, has a good track record of managing money, that you are confident will act in your best interests, and importantly who agrees to undertake this role. Alternately, your solicitor or an independent body such as the Public Trustee (available in each state and territory in Australia) can take on this role. You can appoint more than one person. If so, you can require that all (jointly) or any of them (severally) can sign documents on your behalf.
More information about powers of attorney are available at MoneySmart. It sometimes makes it easier if you and the person you support arrange your powers of attorney and guardianship at the same time; it is prudent for all of us to make contingency plans.
Protect yourself and the person you support from financial abuse
Older people can be more vulnerable to financial abuse. This is because they often depend on others for help with financial tasks and decisions. If a person has dementia, the risk is even higher.
It’s important that other people, including businesses, salespeople, friends and family don’t pressure you or the person with dementia or try to influence your financial decisions.
See financial abuse for the signs to watch out for and where you can get help.
A will gives instructions for how the estate of a deceased person should be distributed. A will is only legal if the person signing it understands the implications of the will. It is important that the person with dementia has ‘capacity’ to sign a will. Capacity is a legal term that refers to a person’s ability to demonstrate that they understand the implications of the document they are signing.
Dementia will eventually affect decision making ability and therefore, a person’s capacity to sign a will. Ensuring your will and the will of the person with dementia is up to date is important. Wills can be made with the support of a solicitor or ‘do-it yourself’ kits available from newsagents or online. Be aware that if a ‘do-it-yourself’ will is made and later challenged, it is harder to justify that the person with dementia had capacity when making the will. A solicitor will determine if a person has capacity.
A will requires careful thought. For example, what if you pre-deceased your loved one and the person’s dementia had progressed? Have you considered alternative executors for your estate and how best to support the person with dementia? For more information about wills, visit Australian Seniors.
Discuss with the person you support
Discuss arranging power(s) of attorney and preparing wills for you and the person you support.