Advance Planning for Dementia

Stories of seniors targeted by deceptive marketing programs and financial scams dominate the news. Because of accumulated wealth, memory decline or isolation (as friends pass away or relocate), older adults are too often the victims of fraud. However, there are ways to protect family members and friends from exploitation, including maintaining close contact and learning about aging.

If a loved one is between the ages of 80 and 90 years old, there is a 50% likelihood that he has been diagnosed with a full-blown case of dementia or is presenting symptoms of the disease. There are more than 70 diseases and conditions that can cause dementia. Alzheimer’s disease is just one example, accounting for over 60 percent of all cases of dementia. Today, 5.4 million Americans are living with Alzheimer’s disease. 1

Because the impact of dementia is far reaching, we believe that it is important that advisors understand the cognitive challenges that senior investors often face. The Securities Exchange Commission (SEC), North American Securities Administrators Association (NASAA) and the Financial Industry Regulatory Authority (FINRA) view the protection of senior investors as a priority and have provided regulatory guidance, presented educational programs on the topic and conducted focused regulatory examinations.

At Truepoint, we have identified the following practices in order to better assist our senior clients and their families:

Training on Senior Specific Issues

Wealth advisors who have worked closely with clients for a number of years may be the first to notice signs of cognitive loss. We recently invited a representative from the Cincinnati chapter of the Alzheimer’s Association to speak to our team. Much of the presentation focused on identifying early signs of diminished capacity, including, but not limited to:

  • The client appears unable to process simple concepts
  • The client demonstrates instances of memory loss
  • The client’s behavior is erratic
  • The client appears unable to appreciate the outcomes of decisions
  • The client is not aware of, or does not understand, recently completed and discussed financial transactions
  • The client appears uncharacteristically unkempt or forgetful

Policy for Addressing Concerns

If an advisor notices signs of cognitive loss, what’s the next step? As a fiduciary, we need to delicately balance our respect for the client’s privacy while best serving the financial needs of the client. While advisors are not bound by the same confidentiality requirements as an attorney or physician, we believe it is best to obtain permission before reaching out to a family member or trusted individual.

We recently introduced a new document, Authorization to Discuss Financial Affairs. The document allows a client to indicate his or her preferences for action by Truepoint if signs of cognitive loss are identified. The client can instruct Truepoint to continue in the same capacity as before or request that the advisor discuss concerns with the client and as needed, make contact with an identified individual.

We believe that introduction of the new document will spur conversation about financial affairs before a crisis arises. As clients age, we encourage the involvement of family members. Having family members attend meetings can provide a dual purpose: a second set of ears to understand current financial decisions, as well as an opportunity to educate family members about the client’s finances.

Encouraging Clients of All Ages to Prepare for the Future

Unfortunately Alzheimer’s is not limited to seniors. Approximately 200,000 Americans are living with younger-onset Alzheimer’s disease. Clients of any age can take steps to plan in the event of mental incapacity. Truepoint is introducing the Authorization to Discuss Financial Affairs document to all clients – generally during an annual review or estate update meeting. We welcome the opportunity to further explore your preferences with you when such a time arises that you wish to begin the discussion.

Truepoint Wealth Counsel is a fee-only Registered Investment Adviser (RIA). Registration as an adviser does not connote a specific level of skill or training. More detail, including forms ADV Part 2A & Form CRS filed with the SEC, can be found at Neither the information, nor any opinion expressed, is to be construed as personalized investment, tax or legal advice. The accuracy and completeness of information presented from third-party sources cannot be guaranteed.

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