Simplify, protect and distribute an estate according to your wishes
You may be inclined to ignore your finances while dealing with your diagnosis of Alzheimer’s, but it is important to begin assessing any financial vulnerabilities you may have. This is not the time to disengage from the management of your financial and legal affairs. Information is power and it will help to reduce at least one stressor. Use this time to ask lots of questions in order to eliminate financial unknowns. Disclose any concerns you have to your legal or financial advisors. Share your wishes and values with those who will be assisting you through the stages of Alzheimer’s and share your concerns about anyone who may pose a threat to your financial situation. This keeps you in control of an important area of life.
How to start.
Write a realistic assessment of your financial situation. List all assets and debts and build a personal net worth statement. There are many online calculators to help with this task. This online calculator from Desjardins lists a range of asset and liability categories to help ensure items are not forgotten. It will automatically calculate your bottom line. If you have a partner, calculate your combined net worth. Make sure that you understand what each asset is, who the legal owner(s) is/are, and confirm that beneficiaries are identified and correct. In your will, beneficiaries should be identified on insurance, registered retirement savings plans (RRSP), registered retirement income fund (RRIF) and on tax free savings accounts (TFSA). File paperwork in a safe place and keep your trusted partner informed.
Cash flow considerations.
Cash flow is key to help ensure that your current and future needs will be met. Even with substantial assets, you can find yourself in financial trouble if there is inadequate cash flow. Determine the liquidity of each asset and their risk class. Depending on your location and the economy it may be difficult to sell your real estate and access cash when you need it. Accessing credit could be difficult if you and your spouse have stopped working due to the progress of the disease. Avoid the need to sell an asset when the market is weak and the sale does not receive top dollar. Flexibility in your finances is important.
Working with others on your finances.
As Alzheimer’s progresses, there will be a need for your trusted financial partner and possibly even a professional advisor to become more involved with many of your financial tasks. Hopefully you will want to participate in decisions about your finances for as long as possible. Through the sharing of responsibility you can avoid some unexpected problems such as unpaid bills, unnoticed irregularities on statements, or other issues that can sometimes become major hassles if left unnoticed for any length of time. An eviction for unpaid rent or discontinued utilities occur because the person with Alzheimer’s is unaware of their deteriorating abilities and overlooks financial matters.
Sometimes, your spouse or another key person will not want to assume the role of financial manager. They too will disengage due to fear or denial of Alzheimer’s. This can leave finances at risk from threats of abuse, misuse or fraud. Consider navigating this hurdle with the support of a grief counsellor. Do not hesitate to bring in more people to help. Avoidance of financial discussions has the potential to threaten long term financial well-being.
The bottom line in money matters is to remain engaged, share your values and directions with others and bring in professionals to help you navigate more difficult financial matter.
Last Updated: 11/08/2017