11 signs your loved one may need help managing money

Study after study reveals one of the earliest signs of dementia is financial trouble.

Years before official diagnosis, individuals in the beginning stages of cognitive decline struggle to manage their money¹. This is likely because diminished executive function is one of the first symptoms, impeding the ability to plan ahead and meet goals, control impulses, analyze multiple factors in financial decision making, and stay focused on multi-step tasks. Knowing this, you can quickly see how impaired executive function makes it difficult to do things like follow a budget, decide what’s appropriate to buy and how much to spend.

The consequences to financial health during this precarious pre-diagnosis window can be catastrophic. Recent research shows that household wealth can drop by over 50% in the 8 years before a dementia diagnosis¹. It’s a tricky time because this phase often coincides with individuals becoming more secretive about their finances.

When you know what to look for, you can get ahead of the potential problems.

Here are some red flags that may indicate your loved one could use a helping hand with money management.

Money worry. Does your loved one exhibit anxiety about whether they have enough money? Or seem unsure or disorganized with their finances? These can be some of the earliest signals of faltering executive function.

Number trouble. Struggling with simple math like calculating a tip, counting change or balancing a checkbook can be red flags. You might also notice the person makes mistakes in reading numbers. More giving. Does your loved one donate to anyone who asks? Increased and uncharacteristic charitable giving is linked to early stages of cognitive decline.

Missed (or multiple) payments. Missing credit card and mortgage payments can be an early sign of cognitive decline, commonly occurring 6 years or more before a diagnosis². Keep an eye out for unopened bills or past due notices. Alternatively, your loved one might pay the same bill twice.

Falling credit score. Research repeatedly shows a correlation between plummeting credit scores and the pre-diagnosis window for cognitive decline². Pay attention to this marker that can show up years prior to diagnosis.

Spending changes. Some people in the pre-diagnosis window buy more than usual. Far more begin spending less. Be aware of anything that seems different from your loved one’s usual spending patterns. Higher utilities costs. Your loved one may forget to turn off appliances and lights, or fail to adjust the thermostat, resulting in increased costs for gas and electric. Some people may need to do laundry more frequently as well, leading to heftier energy bills.

Less self-care. When financial institutions tracked spending by category in the decade prior to a power of attorney being created due to cognitive decline, they found a marked decrease in self-care spending². That means a dropoff in purchasing items like soap, shampoo, toothpaste and deodorant. Similarly, this population spent less on healthcare, like doctor’s and dental visits. Monitor loved ones’ self-care supplies to see if they are keeping up with their needs.

Falling for fraud. Unfortunately, those experiencing cognitive decline are particularly vulnerable to fraud. Be vigilant in monitoring how your loved one reacts to scam texts, phone calls and even direct mail. Do they seem aware of the danger? Or do they ask you how to respond?

Lower logins. Cognitive decline often correlates with fewer online banking logins. Your loved one may go to their branch more often, or simply stop actively engaging digitally and in person.

Frequently forgotten pins. As cognitive decline worsens, individuals often forget their pin and have to request resets. Watch for trouble remembering pins, passwords, or taking multiple attempts to successfully login.

If you observe multiple behaviors listed here, it’s best to be proactive. It can certainly be a delicate balance to strike between protecting your loved one and helping them retain their independence for as long as possible, but your caring efforts now can have a lasting impact. Fortunately, there are several actions you can take right away, even if you’re not ready for a formal power of attorney or legal guardianship³.