Alzheimer’s Planning: A Case Study

Alzheimer’s Planning: A Case Study

By: Martin M. Shenkman, CPA, MBA, JD

How does one deal with a client who has been diagnosed with Alzheimer’s, but is still sufficiently competent in that he can still sign documents and know what is going on? Alzheimer’s disease is a debilitating, progressive illness, in which the patient will almost definitely lose all competence. Therefore, you should get everything done as if it were the last time to get it in order

  •  First, you should get the balance sheet, the family tree, and find out all the facts, just like in any other situation
  •  The issue of the durable power of attorney demands a little more attention than usual. You cannot use the boilerplate document; you must tweak them a little.
    • The issue of compensation. Often you give this power to a family or friend, and they do it as a favor. However, when you have any chronic disease, the responsibility of the person with the durable power of attorney increases. You may choose to compensate them to make sure they take their job seriously
  • How you decide to handle gift provisions can vary greatly.
    • Decide to give no gifts (because you need all the money for your own medications and care).
    • Give all your money away in gifts.
    • Somewhere in between these two extremes.
  • The will of the patient with Alzheimer’s will not change, but the will of the Alzheimer patient’s spouse will likely change in that he should put all assets into a trust.
  • Organize all of your documents and records to save time for others once you are no longer competent.
  • One difficulty with Alzheimer’s, and old age in general, is that there is no clear cut way to define “competent”.
  •  Remember that the medications and care that you may require at later stages of the illness will be expensive. This could affect your investment planning.

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