Financial Planning in the Age of Dementia

By
Jeff Motske, CFP®
May 29, 2018
Share on:

We live in a dynamic and inspiring time. Advancements in healthcare are doing wonders for retirees. Many are living longer, in greater physical health, maintaining their mobility and independence. However, there has also been a growing impediment to that independence – dementia. This syndrome that characterizes the decline of cognitive functions and encompasses degenerative diseases like Alzheimer’s, Parkinson’s and Huntington’s is impacting more and more every year. While it can be very uncomfortable to consider yourself or a loved one suffering from such an illness, living in this age of dementia makes planning for its onset a necessary endeavor.

The statistics are sobering. Those who are diagnosed with Alzheimer’s disease can typically live four to eight years after the initial diagnosis. However, there are also those who can live up to twenty years after their first diagnosis. As this is a disease that wrecks the mind, not the body, some can live up to 5 years in long-term care, rather than the typical two years of other illnesses. Needless to say, the costs of care can be staggering. With expenses ranging from various prescriptions, personal care supplies, limited or long-term care services, there is clearly a lot to plan for. Many rely on Medicare to cover the expenses. Yet, Medicare does not cover everything, oftentimes paying up to 80% of costs, only covering fees that are considered “medically necessary” and taking time to determine what falls under that qualification.1 When you or your loved one is struggling daily with the complications of dementia, hope can seem far off or entirely out of reach.

Due to the subtle ways symptoms can first appear, many can go years without a diagnosis. Unfortunately, that does not mean that the illness is not affecting their lives. While there are specific stages of decline with various forms of dementia, financial matters are generally impacted immediately. Memory suffers, with individuals forgetting to stay current with their bills or having issues understanding their bank and account statements. With subsequent stages, financial skills, along with others, decline further. It can be a rapid and steep decline. An individual’s independence, financial and otherwise, can be compromised very quickly.

This is why it is very important to discuss financial and legal matters once a loved one has been diagnosed, regardless of whether it may feel awkward or uncomfortable. The sooner these conversations take place, the better. There is a lot of information to cover and a lot of decisions on the possible future to make. Most importantly, the earlier the conversations are started, the more of a role the diagnosed person will have. At the end of the day, that is what we all want, for our loved one's wishes and desires to be upheld, even when they may no longer be able to vocalize them.

In addition to helping our loved ones afflicted with these diseases, we cannot forget the loved ones providing the assistance. The strain that can get placed on a familial caregiver can often get overlooked. If not adequately planned for, some will dip into their savings and sell their investments to cover the mounting costs to care for their loved ones. Additionally, the stress of the situation can detrimentally impact the physical and emotional health of the caregiver, which can put both individuals at risk.

Clearly, there is a lot to consider, and for many, it is easy to get overwhelmed, flounder in all the unfamiliar information and overlook that which we are not well-versed on. This is where your financial professional can assist you, both in the midst of this difficult time and also well before the actual diagnosis. They can help you make decisions and preparations, as well as educate you on the myriad of things you may not be aware of but need to know. Additionally, Trilogy Financial advisors are trained to not only identify when clients may be exhibiting symptoms of dementia but to continually monitor these behaviors as well. We truly do take our clients’ well-being seriously. Many individuals I have encountered have two distinct fears about growing older. The first is running out of money. The second is becoming a burden to their family. With dementia, those two fears can become a reality. However, with the proper preparation and planning, they don’t have to be.

Sources: 1. https://www.medicareresources.org/faqs/what-benefits-does-medicare-provide-for-alzheimers-patients/

You may also like:

By Trilogy Financial
August 1, 2023

A romance scam, also known as an online dating scam, is when a person gets tricked into believing they’re in a romantic relationship with someone they met online, when in fact their other half is a cybercriminal using a fake identity to gain enough trust to ask — or blackmail — them for money.

Oftentimes, a romance scammer starts on dating sites or apps. But scammers have increasingly started finding targets on social media, too.

After connecting with someone through a fake profile, the scammer will strike up a conversation and start building a relationship by regularly chatting with them. Once they start to trust the romance scammer and believe they have a truthful relationship, the cybercriminal will make up a story, ask them for money, and vanish.

Types of Romance Scams

Some of the most common internet dating scams include:       

Fake Dating Sites: Scam dating sites claim to be legitimate but are actually filled with scammers or underpopulated. These websites are created to mine your information.

Photo Scams: Scammers will convince their target to send their personal information in exchange for intimate photos.

Military Romance Scams: The scammer will pose as a military member, likely deployed. They build trust by using military jargon and titles, then ask for money to cover military-related expenses, such as flights home.

Intimate Activity Scams: The scammer connects with their target on multiple social media websites. Once they become closer, the scammer convinces them to undress and then threatens them with the recordings.

Code Verification Scams: Scammers will send a fake verification code through email or text, posing to be a dating app or website. Once clicked on, it will ask for their personal information, including Social Security number and credit cards.

Inheritance Scams: Scammers will make their target believe they need to get married in order to get their inheritance. In this case, they will ask them to help pay for something like airfare.

Malware Scams: Malware is also common on dating sites. In this case, the recipient will interact with a scammer who sends them a website that looks legitimate; however, it's a page that includes malware.

Tips To Avoid Losing Money To a Romance Scam

  • Protect yourself and older loved ones by raising awareness. Although this can be an uncomfortable topic, make sure you, your family and your friends are familiar with romance scams. The more you know about these scams, the better prepared you are to prevent being a victim.
  • Check in on older loved ones. Scammers are seeking to target those living alone or grieving the loss of a spouse as they are more vulnerable.
  • Limit what you share online.Scammers can use details shared on social media and dating sites to better understand and target you.
  • Do your research.Research the individual’s photo and profile using online searches to see if the image, name or other details have been used elsewhere.
  • Go slowly and ask lots of questions.Don’t let the individual rush you to leave a dating service or social media site to communicate directly.
  • Listen to your gut.If the individual seems too good to be true, talk to someone you trust.
  • Don’t overshare personal information.Requests for inappropriate photos or financial information could later be used to extort you.
  • Be suspicious if you haven’t met in person.If the individual promises to meet in person, but consistently comes up with an excuse for cancelling, be suspicious.
  • Don’t send money.Never send money to anyone you have only communicated with online or by phone.

Think you’ve been scammed?

  1. Stop communicating with the individual immediately.
  2. Talk to someone you trust and describe what’s going on.
  3. Report the incident to local law enforcement.
  4. Submit a fraud complaint with the Federal Trade Commission.

Dating scams can have devastating consequences on individuals seeking love and companionship online. It's crucial to be aware of the red flags and take necessary precautions to protect yourself from falling victim to these fraudulent schemes. Even if it’s too late to recoup losses, details may help others from becoming a victim.

 

By
Ahmed Ghulamali
September 26, 2017

What does retirement actually look like? Some people might say they will literally “turn in their papers”, go home, then putz around the house and tinker with projects for the rest of their life. Others might say they want to travel the world. Some might say they don’t actually want to “retire”, but would rather transition to work they are passionate about, without having to worry about what kind of income they receive. The bottom line is that we tend to have some idea of what we dream it to be. The problem is, there are factors that can contribute to turning our dreamy retirement into a complete nightmare.

Trying to predict that our retirement will end up being exactly as we have planned it to be is like shooting an arrow towards a bullseye as we are blindfolded. It COULD happen, but there are a lot of “what ifs” circling around our idea of a perfect retirement. For instance, what if we retire and expect to putz around the house doing projects for the rest of our life, and find that by week three we are bored out of our mind, yet we didn’t prepare or invest in doing anything different? What if we expected to travel the world, but before retiring, develop health issues that prevent us from being able to do so? The “what ifs” can be a real game changer, not only to what we get to do, but how we would be prepared to pay for it.

Here are some tips to consider when thinking about how to prepare for retirement:

Retirement vs. Financial Independence. Trying to decide now, at our current age, what retirement has to be can be quite stressful. Maybe we don’t have a clue what it should look like in regards to activities and how we will spend our time. So instead of trying to define what retirement might look like, maybe focus on working towards financial independence. Financial independence means over the course of a long-term, disciplined effort, we work with our advisors to help us make financial and protection planning decisions that lead to financial strength over time. Disciplined effort and long-term commitment are key factors when trying to build financial security. This might prove helpful with preparing for whatever retirement ends up looking like.

Planning before Investing. There are thousands of licensed financial professionals whom would love nothing more than to manage our assets by investing in the market. Many go into this with the sole goal of simply “growing assets”. They tend to focus on returns, and believe that we only want to hear that our investments are “going up” consistently. Seeing our account values “go up” is all the satisfaction they think we desire. And with that, they tend to feel like we are on track for retirement. BUT, this is not a guarantee. We can’t predict or control the markets, so this is an example of shooting that arrow blindfolded, hoping we land in the middle. Instead, consider focusing on what your assets need to DO. What job do our assets have? Knowing what the job is upfront will help us make more informed decisions not only on how to invest, but with what kind of risk we can afford to subject ourselves to. Risk management might prove just as critical as growing assets.

Start NOW! Financial planning for retirement could prove far more difficult if we wait to the last minute, vs. making effort starting now. It might seem daunting to think we have to “do everything at once”, but focusing on our future needs is just as important as focusing on our current needs. It might seem difficult to do everything at once, but that’s why working with a financial advisor who values planning prior to investing blindly might prove helpful.

We are all unique in what our lives and dreams are. And whether we are focused on exactly what we want retirement to be, or simply have no idea, the common theme is that the closer we are to having financial independence, the better chance we have of being more prepared. Financial independence shines the light on our options, which might help to make our dreams come true.  And just like when we were kids in a dark room, the nightmares tend to not go away until we turned on the lights!

Get Started on Your Financial Life Plan Today