Alzheimer’s diagnoses have become sadly commonplace in today’s society. According to the Alzheimer’s Association, one in eight American families will be affected by this dreaded disease.
Many estate planning clients have adopted incapacitation strategies, to help handle their affairs in case they become incapable of handling them. Alzheimer’s, with its creeping deterioration of the brain, is different from many other diseases, as its gradual onset provides people with an opportunity to react proactively to the limits they will endure in their future.
One possibility for clients who are starting to get concerned about Alzheimer’s is that they could create a shadow plan, one that would come into effect if the diagnosis ever comes about. Here are a few things that clients should keep in mind if they are presented with – or fear being presented with – a diagnosis of Alzheimer’s:
It’s important to have all of the client’s legal documents and other papers in one place. Wherever these papers are located, some trusted person – a family member in most cases, but it would be helpful if a financial advisor did as well – should know exactly where they are, and what is included in them. If they are in a safe, the family member should have the combination; if they are in a safe deposit box, the family member should have access to a key.
There are two basic types of documents that need to be kept at hand. The first group, related to the financial well-being of the client, including the client’s will, bank and brokerage accounts, insurance policies, etc., aren’t specific to the Alzheimer’s patient.
But the client who has received an Alzheimer’s diagnosis may need to assemble the other types of documents, reflecting their health care decisions and including such things as Powers of attorney and Do Not Resuscitate orders. We’ll talk more about these documents further on. Property Management
It probably makes sense for a person who has received an Alzheimer’s diagnosis but still retains most of his or her faculties to appoint someone to manage his or her property. This person can be a family member but is better placed as a financial professional who can work closely with the client. Together they can create a plan for managing and disposing of the client’s property as he or she becomes further incapacitated. Without a written plan for property management in place, it is likely that a court would have to decide who should manage the client’s affairs.
Advance directives are one of the keys to caring for a client with Alzheimer’s disease. Alzheimer’s patients live for years with diminished mental skills, which makes it crucial that they make decisions early on about how their care should proceed. Some of the documents that every Alzheimer’s patient should consider:
- Durable Power of Attorney designates a person to make health care decisions when the Alzheimer’s patient becomes unable do so. A durable power of attorney is generally the choice for Alzheimer’s victims because it doesn’t come into effect until the designator is incapacitated.
- A Living Will specifies the amount and duration of care a person wants to receive at the end of his or her life. It can also delineate the amount of leeway the client gives to the person making decisions on his or her behalf.
- A Do Not Resuscitate Order instructs medical professionals not to perform CPR or other “heroic measures” on a patient. Interestingly, doctors are far less likely than the general public to want CPR to be performed on them. According to one survey, 90 percent of physicians would not want CPR in an end-of-life scenario.
A living trust can be a truly valuable and versatile tool for an Alzheimer’s patient. Through it, the client can appoint a trustee to hold title to the assets in the person’s estate, with detailed instructions for how the property should be disposed of. The trustee does not take responsibility for these assets until such time that the creator of the trust is unable to manage them.
The living trust can even provide instructions for how the property should be distributed after the last beneficiary dies. Of great significance to the heirs, it can also help to keep the client’s assets out of probate. With the gradual assumption of responsibilities on the part of a hand-picked trustee, a living trust is tailor-made for the needs of an Alzheimer’s patient.