Age-related cognitive decline

Isolation, the death of a spouse and a shrinking social network are factors that can make the elderly more vulnerable and expose them to a higher risk of financial abuse. Financial decisions made under stressful conditions can have serious consequences.

Sound financial management involves planning for the worst-case scenario. The time to plan is when everything is going well.

Discuss it with your aging relatives and friends

It’s a touchy subject, but it has to be discussed if you want things to go smoothly.

Ideas for starting a discussion

Take advantage of a situation or an incident to talk about it. For example, has someone you know had a bad experience recently because of poor planning? Has an acquaintance, neighbour or friend become incapacitated lately?

Your aging relatives and friends will likely be reassured to know that you’ll be there if they need you and that you want things to be done according to their wishes.

Remind them that accepting help doesn’t mean losing control of their finances. Instead, it’s a way to ensure that their personal finances will continue to be properly managed and that they’ll be protected against financial fraud and its unwanted consequences.

10 questions for starting a discussion while everything is going well

  1. Where do they keep their important documents?
  2. Which financial institution(s) do they do business with?
  3. What are their monthly expenses (financial obligations, utility bills, etc.) and how do they pay their bills (pre-authorized payments, cheques, bank transfers)?
  4. What are the names and contact information of their accountant, representative or financial planner?
  5. What is their source of income (pension plan(s), registered investments (RRSP, TFSA, RRIF, etc.) and non-registered investments)?
  6. Do they have income from government sources (Québec Pension Plan, Old Age Security, Guaranteed Income Supplement, etc.)?
  7. Do they have other sources of income (rental income, business income, etc.)?
  8. Do they have any insurance policies (extended health insurance, life insurance, home insurance, automobile insurance, etc.)?
  9. Do they have a protection mandate (mandate in case of incapacity)?
  10. Was the mandate drawn up by a firm? If so, what is the notary’s contact information?

If cognitive decline is already apparent

Are you concerned about a friend’s or relative’s financial situation? Have you noticed signs of decline or vulnerability? Do you feel that urgent action is required?

Being able to recognize the warning signs is a plus.

Examples of some unmistakable signs

  • The person leaves unopened envelopes lying around and lets unpaid bills pile up.
  • They lose track of their documents.
  • They make unusual purchases with their credit card.
  • They accumulate or buy things they don’t need or buy things they already have.
  • Their bank accounts are overdrawn or have insufficient funds to cover current expenses.
  • They are unable to do simple calculations or understand basic financial concepts.

If cognitive decline is already apparent

A specific incident has occurred and the necessary planning hasn’t been done. What now?

When a person’s condition changes and they no longer seem able to care for themselves or manage their personal finances, it likely means that they are incapacitated.

It’s time to take the necessary legal steps to ensure they are protected:

  • If the person has a protection mandate, its validity will need to be verified (meaning it must be homologated). The application for homologation can be done with a notary or at the Superior Court of the judicial district where the incapacitated person resides.

  • If the person does not have a protection mandate, the available options will have to be reviewed.

    A court or a notary will call a meeting of relatives or friends to designate someone to look after the person’s assets. The court will consider the view of relatives or friends. It will then give its opinion on who would be best suited to look after the incapacitated person and name a tutor or a curator, depending on the degree of incapacity.

    If no one is able to take care of the person’s affairs, this responsibility will fall to the Curateur public (public curator).

For more information, visit the Curateur public This link will open in a new window website.

Insight

It’s much easier to prepare for a person’s incapacity than to take steps once it happens, which is why it’s important to discuss these issues with aging relatives and friends sooner rather than later.

End of the insight

References

Le Curateur public du Québec This link will open in a new window (public curator)