Can a Person with Alzheimer’s Sign Legal Documents?
If a loved one has been diagnosed with Alzheimer’s disease or any other form of dementia, it is necessary to address legal and financial issues as soon as possible. The person’s ability to sign documents and take other actions to protect themselves and their assets will be limited as the disease progresses, so there’s no time to wait. This recent article “Financial steps to take when dealing with Alzheimer’s” from Statesville Record & Landmark explains the steps to take.
Watch for Unusual Financial Activity
Someone who has been sensible about money for most of his life may start to behave differently with his finances. This is often an early sign of cognitive decline. If bills are piling up, or unusual purchases are being made, you may need to prepare to take over his finances. It should be noted that unusual financial activity can also be a sign of elder financial abuse.
Designate a Power of Attorney
The best time to designate a person to take care of finances is before she shows signs of dementia. It’s not an easy conversation, but it is very important. Someone needs to be identified who can be trusted to manage day-to-day money matters, who can sign checks, pay bills and supervise finances. If possible, it may be easier if the POA gradually eases into the role, only taking full control when the person with dementia can no longer manage on her own.
An individual needs to be legally competent to complete or update legal documents including wills, trusts, an advanced health care directive and other estate planning documents. Once such individual is not legally competent, a Louisiana court must be petitioned to name a family member as a curator, or a curator will be appointed by the court. It is far easier for the family and the individual to have this handled by an estate planning attorney in advance of incompetency.
An often-overlooked detail in cases of Alzheimer’s is the beneficiary designations on retirement, financial and life insurance policies. Check with an estate planning attorney for help, if there is any question that changes may be challenged by the financial institution or by heirs.
Cost of Care and How It Will Be Paid
With a good Power of Attorney (“Mandate”), your loved one can avoid an interdiction proceeding in Louisiana (called guardianship in other states). Interdiction is an expensive and time consuming legal process, since the family member with Alzheimer’s must actually be sued. This of course, involved hiring a lawyer. Then (typically) the court will appoint a second lawyer to represent the family member. This results in DOUBLE the legal fees, and the process can drag on for months. A simple power of attorney can avoid this.
Cost of Care and How It Will Be Paid
At a certain point, people with dementia cannot live on their own. Even those who love them cannot care for them safely. Determining how care will be provided, which nursing facility has the correct resources for a person with cognitive illness and how to pay for this care, must be addressed. An elder law estate planning attorney can help the family navigate through the process, including helping to protect family assets through the use of trusts and other planning strategies.
If the family has a strong history of Alzheimer’s disease or other cognitive diseases, it makes sense to do this sort of preparation far in advance. The sooner it can be addressed, even long before dementia symptoms appear, the better the outcome will be.
BOOK A CALL with me, Ted Vicknair, Board Certified Estate Planning and Administration Specialist, Board Certified Tax Law Specialist, and CPA to learn more about business planning, estate planning, incapacity planning, and asset protection.
If you liked this article, “Can a Person with Alzheimer’s Sign Legal Documents?” read these additional articles: What a Will Can and Cannot Do and Multiple Marriages and Blended Families Create Unique Situations and Should I Use a Corporate Trustee? and What Happens If a Trust Is Invalid?
Reference: Statesville Record & Landmark (April 11, 2021) “Financial steps to take when dealing with Alzheimer’s”