A Diagnosis of Dementia & The Next Steps to Safeguard your Finances

A Diagnosis of Dementia & The Next Steps to Safeguard your Finances

Alzheimer’s Research UK estimates that one out of every two of us will be affected by dementia in our lifetime, and that currently 944,000 people in the UK are estimated to be living with dementia.

A diagnosis of dementia would of course be a very upsetting time for yourself and your family, but there are steps you can take, both before and after diagnosis, to make sure that your affairs are in order.

Powers of Attorney for Property & Finances

A recent survey suggests that 80% of people in the UK have not yet made either an Enduring or Lasting Power of Attorney to allow a third party, known as an attorney, to assist them in the future with either their financial affairs or health and welfare.

If you are in the majority, and you receive a diagnosis of dementia, it is now important that you consider who will support you in managing your finances, or will make welfare decisions for you on your behalf, should you one day not be able to make these decisions yourself.

A person must have the mental capacity to make a Lasting Power of Attorney (LPA). This means that you must be able to understand what an LPA is, how it works, who it appoints and what power those people will have under the document. You must also have knowledge of your own financial situation. For example, you may trust a certain family member to look after a bank account holding £100, but would you trust that same person if they were looking after £1 million for you?

A person’s mental capacity will change during their dementia journey, but a loss of capacity in one area does not mean that you will have lost capacity in all areas. You may no longer remember the route around your local town like the back of your hand, but you may still be able to understand your financial situation and the powers an LPA grants. If in any doubt, your GP, social worker or capacity assessor will be able to help you decide whether you still retain the requisite capacity to make an LPA.

If you have already made an Enduring Power of Attorney, it may be time to discuss with your attorneys about using this to support you with your finances day-to-day. They must use this document with your knowledge and understanding, and must register the document with the Office of the Public Guardian to continue acting for you should you lose mental capacity.

If you choose to not make a Power of Attorney, your family or support network may be forced to apply to the Court of Protection to be appointed as your deputies. This can take up to a year to come to fruition, three times as long as the preparation of an LPA, and can cost much more.

Your Will

Again, in order to make a Will, or amend one, you will require what is called testamentary capacity – the ability to understand a Will, your wishes, your personal circumstances, and the implications of any decisions that you make in relation to the same. However, a diagnosis of dementia does not of course automatically rob you of this capacity, and many people are able to prepare and amend Wills after their diagnosis.

A Will is an important document as it details where our finances go after our death, and it should be reviewed every 3-5 years or in line with any changes in our own personal circumstances.

In line with your diagnosis, it would be a good idea to ensure that the wishes detailed in your Will still align with your personal situation and your current thoughts and feelings. If they do not, it is important to get these updated as soon as possible.

Advance Directives & Lasting Powers of Attorney for Health & Welfare

There are over 200 subtypes of dementia, each of which can affect a person differently. However, it is likely that at some stage following your dementia diagnosis, your medical and care needs will increase and change.

You are responsible for making all of your own health and welfare decisions all the time that you are able to. If you lose the capacity to do so, a best interest decision can be made by a medical or care professional, dependent on the type of decision that needs to be made.

Unless you have an Advance Directive or an LPA for Health & Welfare in place, there is no guarantee that your chosen loved ones will be consulted in any decision making on your behalf. Such decisions can include the consideration of your suitability for different medical treatments, where you might live and who can visit you.

Advance Directives and LPAs can both be used to set out your wishes in advance of a loss of capacity, whether that is the request for a DNAR to be put in place for you, or if you would like to remain living in your own home for as long as possible, or if you would like your son or daughter to make particular decisions for you if you can no longer make them for yourself.

Contact

To plan for the future by making or registering a Power of Attorney, drafting a Will or preparing an Advance Directive, do speak with our Private Client Team.