As people age, the mind changes in many ways. One negative side effect of aging is a gradual decline in cognitive ability, which can manifest itself in many different ways. One of which is a difficulty in handling finances. According to the National Center for Biotechnology Information, “the ability to perform simple math problems, as well as handling financial matters, are typically one of the first set of skills to decline in diseases of the mind, like Alzheimer’s.”
Even though an elderly person may have their wits about them and be relatively cognitively healthy as a whole, they may not be able to understand money the same way they used to. This can obviously lead to a host of problems like mismanaging their finances, and it increases their likelihood of being taken advantage of. Take a look at these specific symptoms of financial decline in the elderly along with a few ways loved ones can respond.
1) Taking Longer to Complete Routine Financial Tasks
When a person begins taking longer than usual to prepare bills for mailing or electronic payment they may be suffering from a decline in cognitive function. These simple and straightforward tasks that used to be automatic can suddenly become arduous and take noticeably longer than in the past. This may also manifest itself as confusion that was not previously evident in an elderly person when completing tasks such as filing income taxes.
2) Having Problems with Financial Document Details
A person suffering from financial decline may become forgetful with bills and not be able to identify when a payment is due or even overdue. They might also have trouble finding a particular detail in a bank statement or be easily confused when looking through account statements, sometimes not remembering charges on their account or overlooking charges that shouldn’t be there.
3) Difficulty with Everyday Math Skills
As cognitive ability declines, everyday tasks such as determining how much to tip at a restaurant or calculating a return on investment can become much more difficult. Something as simple as figuring out percentages can become problematic as the details and processes of how to figure simple problems becomes unclear with age.
4) Struggles with Financial Concepts
An elderly person may suddenly struggle to comprehend concepts like an interest rate and minimum balance. When it comes to insurance topics, they may no longer understand exactly what a deductible is. If they were especially sharp about these concepts in their younger years, there may be cause for concern that should be addresses by loved ones.
5) Problems with Pinpointing Financial Risks
Elderly persons who experience this deterioration of cognitive capacity may not fully understand the risks and potential scams involved with telephone or mail offers. They may also be unaware of what risks they face in investment opportunities.
Tips for Coping with Financial Decline
As estate planning attorneys, there are many ways you can help families prepare for cognitive decline in their elderly loved ones. You may suggest some of the following options:
- Have them consult a physician to determine if dementia may be evident
- Have a trusted caregiver monitor their financial transactions
- Contact the person’s bank, and instruct them to check for anything out of the ordinary such as paying the same bill twice
- Have a trusted caregiver become a co-signer so their signature is required before large checks are processed
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