Estate Planning After an Alzheimer's Diagnosis

Nearly 6 million people live with Alzheimer's in the United States. The discovery that your parent is now amongst this group is life-altering. However, to protect your loved one, you must take immediate action.

Estate planning after this type of diagnosis is incredibly important and comes with its own set of guidelines. The sooner you begin the planning process, the better for the entire family. Read on to learn how you should move forward.

Talk to your parent about giving you power of attorney for financial and health care needs. The financial power of attorney allows you to manage and make financial decisions on their behalf. The health care form gives you input on medically related concerns.

A power of attorney can be permanent or temporary, such as expiring after two years from the signed date. However, in the event your loved one's health declines rapidly, you already have a safety measure in place.

However, to sign over power of attorney, your parent must display sufficient mental capacity. An attorney or notary cannot ethically authorize these documents if the requester does not understand what they are doing.

Perform a financial inventory with your parent. Ask him or her to write down or tell you about all the financial accounts, properties, insurance policies, and other valuables they own. Include any regular expenses, such as credit card bills, on the inventory as well.

Ask for permission to review their bank statements if they struggle to remember all the details. You should be able to get a good idea of what their financial commitments are after reviewing a few statements.

A financial inventory is vital in the event you must step in to pay a bill or handle some other matter. The information can also help your family prepare for any long-term medical expenses.

Speak with your loved one about their afterlife wishes if they don't already have a will prepared. The state has full discretion over an estate when a person dies without a will. Like a power of attorney, your loved one must display the mental capacity to prepare the document for it to be valid.

However, try to stay out of the will preparation process as much as you can, given your parent's diagnosis. In Wisconsin, beneficiaries can contest wills if there is evidence the document was prepared under influence.

If you help your parent prepare the will and you are a beneficiary of the estate, then your actions may be scrutinized. Save your family a contentious court battle and remain a neutral party in the process.

Think about guardianship as a future option. Guardianship grants you the same authorities as a power of attorney. However, the title is court appointed and gives you complete control over the person's wellbeing. For example, you can decide to move your loved one to a care facility without approval or clearance from anyone else.

Since guardianship is a legal and wide-reaching appointment, there is a process involved. You must first prove that your parent requires the help. An Alzheimer's diagnosis on its own may not be enough. You need to show that the disease has progressed to the point that the individual is no longer able to competently make decisions on his or her own.

You also need to have a clean criminal record and no history of filing for bankruptcy.