There are many signs that make us fear that we’re “starting to slip” in the brainpower department. We walk into a room and forget what we came there for. We see an old friend in the grocery store and can’t recall her name. We forget where we put the car keys or the reading glasses. As it turns out, in fact, most of these slip-ups are benign, simply a normal function of getting older and having a lot on our minds. They’re typically nothing to fear.

But there are a few signs that experts say could be more worrisome, as warning signals of the beginnings of cognitive decline. One of the first of these “red flag” alerts, as reported a few months ago by Kaiser Health News, is in the area of personal finances. When someone who has been careful with money starts becoming careless, forgetful, or impulsive, alarm bells should sound. We wanted to bring this important story back for another discussion.

Impulsive Purchases Quickly Forgotten: One Woman’s Story

The Kaiser article, written by reporter Michelle Andrews, tells the story of a South Carolina nurse in her 40s, named Maria Turner. After an accident totaled her van, Andrews reports, “she grew impatient waiting for the insurance company to process the claim. One night, she saw a red pickup truck on eBay for $20,000. She thought it was just what she needed. She clicked ‘buy it now’ and went to bed.” Not until the next morning, when the seller emailed her regarding delivery instructions, did she remember what she’d done.

Turner knew such impulsive and reckless financial behavior was completely out of character, and while she was able to back out of the truck deal, her binge-buying didn’t stop. “She shopped impulsively online with her credit card,” says Kaiser, “buying dozens of pairs of shoes, hospital scrubs and garden gnomes. When boxes arrived, she didn’t remember ordering them.”

Finally, as the article reports, after six years of this behavior, Turner got a medical explanation for her spending binges, headaches and memory lapses: “Doctors told her that imaging of her brain showed all the hallmarks of chronic traumatic encephalopathy,” or CTE, a degenerative brain disease that can be linked to childhood trauma (Turner had suffered several concussions as a competitive horseback rider in her youth). Doctors also diagnosed Turner with the likely presence of early-onset Alzheimer’s disease and frontotemporal dementia.

Losing the Ability to Manage Finances May Be a Warning Sign of Deeper Problems

As the Kaiser article reports, money troubles like these aren’t unusual among people who are beginning to experience cognitive declines. “Long before they receive a dementia diagnosis,” says the article, “many people start losing their ability to manage their finances and make sound decisions as their memory, organizational skills and self-control falter, studies show. As people fall behind on their bills or make unwise purchases and investments, their bank balances and credit rating may take a hit.”

According to mental health experts, the Kaiser article explains, the pandemic of the past 18 months may have helped keep such financial lapses below the radar. “Many older people have remained isolated from loved ones who might be the first to notice unpaid bills or unopened bank notices,” Andrews writes. For many seniors, their “financial decision-making safety net may have been weakened,” one expert told Kaiser. The inability to be face to face has made it difficult to keep an eye on an isolated person’s checkbook.

Families May Miss the Signs of Trouble – Even in Normal Times

Beth Kallymer of the Alzheimer’s Association told Kaiser’s Andrews that even during normal non-pandemic times, families may miss the signs that someone is struggling with finances, experts say. “It’s not uncommon at all for us to hear that one of the first signs that families become aware of is around a person’s financial dealings,” she said. That’s because, even early in the disease, dementia robs people of executive functioning skills like planning and problem-solving. It deprives sufferers of judgment and memory – in short, of the very cognitive abilities and skills required to manage money.

Among many seniors, solitude and pride compound the problem. “People who live alone may be the most likely to slip through the cracks, their lapses unnoticed, Kallmyer said. And many adult children may be reluctant to discuss personal finances with their parents, who often guard their independence.”

Academic Studies Link Early Alzheimer’s with Severe Financial Consequences

The Kaiser article is based in part on recent academic research, including this 2019 study from Georgetown University which examined the effects of early-stage Alzheimer’s disease on household finances. The research demonstrated that “rapid declines in financial capacity are a hallmark of patients with early‐stage Alzheimer’s disease.”  Researchers uncovered what they termed “robust evidence” that early‐stage dementia “places households at significant risk for large adverse changes in liquid assets” and, over time, triggers a reduction in net wealth.

“Our findings are consequential,” said the study, “because financial vulnerability during the disease’s early‐stage impacts the ability of afflicted individuals and their families to pay for care in the disease’s later stage.” Researchers pointed to the need for early diagnosis to help stave off the worst of the adverse financial consequences. The Georgetown researchers also called out banks, brokers, and financial planners. “These results also point to a potentially important role for financial institutions in helping reduce exposure of vulnerable elderly to poor outcomes,” says the study.

The Georgetown research isn’t unique: Kaiser reports that various studies have reached the same conclusion. In one, those with early-stage Alzheimer’s disease were up to 27 percent more likely than those with normal cognitive health “to experience a large decline in their liquid assets, such as savings and checking accounts, stocks and bonds.” Another study that linked Medicare claims with data from Equifax and the New York Fed found that those with dementia started missing bill payments up to six years before diagnosis, and their credit scores began to tank 2.5 years before their cognitively healthy peers.

Tips for Helping a Loved One

We encourage you to read the Kaiser article for yourself, since it includes far more information than we can cover here. But we want to share an abbreviated list of some of the suggestions that reporter Andrews includes in her story. “It’s not easy to broach financial management issues with an elderly parent or other relative experiencing cognitive trouble,” she acknowledges. “Ideally, you and they will have these conversations before problems develop.”

Here’s our bulleted list of suggestions, taken from the Kaiser report and our own experience at AgingOptions.

• Talk with a financial adviser or elder care attorney – their advice can prove invaluable.
• Suggest that you and your loved one adopt a shared financial management arrangement to make it easier to keep track of bills.
• Encourage your loved one to sign a financial power of attorney, authorizing you or another person to act on their behalf in financial matters.
• Consider putting assets in a trust – a legal vehicle that can hold a range of assets and property and spell out how those assets are managed and distributed, during life and after death. A trusted elder care attorney will be an essential partner in this process.
• Have your name added as another user on a parent’s bank accounts, credit cards or other financial accounts – a convenient way to make payments or monitor activity. (Be careful, however, Kaiser warns: “A shared account can be problematic if children are sued, for example, or wish to withdraw the money for their own use.”)

None of these guarantees smooth sailing with a parent or loved one starting to experience cognitive decline, says Kaiser. “Each of these setups may help protect a parent’s assets. But parents may not welcome what they see as interference, no matter how well-meaning family members are. Typically, they can refuse to permit children’s access to their financial information or revoke permission previously granted.”

In an extreme case, the article concludes, drastic measures may be required. “The only way to ensure financial control is to go to court to establish guardianship or conservatorship. But that is a serious step not to be taken lightly.” As one planner told Kaiser, “You only want to do that if there’s a major risk.”

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(originally reported at www.khn.org)