My husband has Alzheimer’s. Our retirement dream is in tatters
Marion and Tom Hinde, from Ellesmere Port in Cheshire, dreamt of buying a camper van and travelling around Britain and France when they retired.
But in 2016, when Tom was 54, he began forgetting things and had uncharacteristic mood swings. Marion, now 57, who works as secretary, said: “It started gradually. He would go into the garage and not find something he was looking for and accuse me of moving it.”
A year later Tom, a petty officer in the Royal Navy, was diagnosed with Alzheimer’s, a type of dementia that causes memory loss, confusion and changes in personality. Financially, they were totally unprepared, and suddenly their retirement plans were in shreds.
Tom took early retirement just short of his 30 years’ service, when most navy personnel must retire, and Marion had to cut back her hours to look after him. Instead of buying a camper van, they used Tom’s £30,000 tax-free pension lump sum to pay off their mortgage. She applied for power of attorney in 2017 to allow her to make decisions about Tom’s medication and finances. They now get his navy pension, which pays him about £1,200 after tax, and some personal independence payments from the government. They have taken out £30 a month life insurance with Royal London to pay out £9,000 for funeral expenses.
Tom, now 62, can dress himself and make a cup of tea but he struggles with numbers and navigation. Their son Kieran, a tyre fitter, lives with them and helps out.
It’s all a far cry from their dream of travel and adventure and a comfortable but exciting retirement.
“Our income has basically halved,” Marion said. “We have to try to stick to a smaller budget. We can’t have many holidays — we haven’t been away this year.”
Many other families are facing futures they did not expect, but there are things you can do to prepare.
Living with dementia
More than 944,000 people in the UK have dementia, according to NHS estimates, and it expects this to rise to more than one million by 2030 — and 1.6 million by 2050. Some people will live with the disease for years. So there will be more families, like the Hindes, having to work out how it will affect the financial aspects of their lives: everything from work and banking to insurance and driving.
Online power of attorney applications have gone from 15,600 in the 2015-16 tax year, when you were first able to apply online, to 507,200 in 2023-24. Lasting power of attorney (POA) grants another person control of your financial or medical affairs, or both, because you are unable to manage them yourself. There were about 777,000 successful applications in 2022-23, the last year for which official data is available.
• You have power of attorney, now comes the really hard part
Banks, insurers and the government are also having to adapt to an ageing population. Nationwide is taking steps to help with a series of trial dementia clinics at 200 of its 600 branches, working with the charity Dementia UK to provide medical experts who can give advice. The service will be advertised in the local areas and will be available to anyone, not just Nationwide customers.
According to research by the Alzheimer’s Society, 76 per cent of people with dementia had difficulties in managing their finances. This could be anything from forgetting to pay bills, to falling for scams or having a smaller pension pot because they had to stop work early.
Tim Beanland from the charity said: “Dementia can sometimes cause changes in a person’s spending patterns, and can affect their ability to manage their money and make financial decisions. People living with dementia may also be more vulnerable to scammers because, although anyone can fall for a scam, a person with dementia can find it harder to assess risk.”
Here are some of the things you need to think about if you, or someone in your family, is diagnosed with dementia.
Protect yourself with a power of attorney
One of the most important things to do is to set up a lasting power of attorney before a person with dementia loses mental capacity, otherwise you have to go through the courts, which can be lengthy and costly.
Lasting power of attorney gives another person control of your financial or medical affairs, or both.There are two types: one for making financial decisions and another for making health and care decisions. You can set up power of attorneys for both — each application fee is £82.
A power of attorney for financial decisions can be used while you still have mental capacity. Your attorney can make decisions about things like selling your home, paying your mortgage and bills, and arranging repairs to your home. You can limit the power you give to your attorney — for example, you could allow them to deal with your bank account but not your property.
You can cancel it at any time while you have mental capacity by contacting your attorney (or attorneys) and the Office of the Public Guardian (OPG).
The OPG says the average time to process a power of attorney application is 16 weeks, double its target of eight weeks.
Insurance
You have a legal duty to inform your car insurer of a dementia diagnosis and this may affect your premiums.
When applying for life insurance it’s vital to disclose all relevant pre-existing medical conditions, including dementia. Not doing so could risk invalidating your policy. The Association of British Insurers (ABI) said: “If the customer has an existing life policy, they generally don’t have to tell insurers of any changes to their health. However, they might want to tell their insurer as their communications needs may change.”
• Why you need a power of attorney now — even if you’re 20
For other policies, such as travel and home insurance, it is not so clear cut, but the ABI said that if you have “a medical diagnosis or are being investigated for dementia, or any other condition, it is best to let your insurer know as soon as possible. If you’re not sure what needs to be disclosed, check your policy wording or speak to your insurer.”
You do not have to tell an insurer if you have had a genetic test that suggests you have a predisposition to a particular disease or condition. The only exception is if you are applying for life insurance covering more than £500,000 and you have had a predictive test for Huntington’s disease. But you only need to disclose this if specifically asked, the ABI said.
Managing bank cards
Anyone who has trouble remembering a PIN should talk to their bank about getting a chip and signature card, which allows you to pay for goods by signing your name instead.
If you have your own bank account but you would like someone to help you manage it, such as a close friend or family member, without granting a power of attorney, ask your bank for a third party mandate that will allow them to monitor and run your account. You can turn this power off at any point.
Missed payments
A study in May by economists at the Federal Reserve Bank of New York and Georgetown University, together with the credit reference agency Equifax, suggested that patients diagnosed with dementia were 17 per cent more likely to miss a mortgage payment and 24 per cent more likely to miss a credit card bill in the year beforetheir diagnosis than they were before.
Generally, people with dementia are responsible for their debts, just like anyone else. However, if you can show that the person didn’t have the capacity to manage their money when they got into debt, it might be possible to get a contract or a loan cancelled under powers in the Mental Capacity Act. You would have to show that the seller knew, or should have known, that they lacked this capacity.
If you borrow or miss a loan repayment resulting in your credit score being adversely affected, a bank can help you to correct this. Financial institutions and the government are legally obliged to act sympathetically and help those with dementia under the Mental Health Act.
• Savers using power of attorney miss out on the best rates
Pensions and benefits
Leaving work earlier than expected will affect the size of your retirement pot and could mean that you cannot take an income if you are below the age threshold (55 for most personal and workplace schemes, rising to 57 in 2028). Many pensions plans will let you access your pot early if you retire due to ill health, so make inquiries.
Marion said that early diagnosis can help you to make plans: “If you think there may be a problem, you need to get to the doctor as soon as possible and ask for an assessment. We were lucky as it was our doctor who first referred us to the memory clinic. If you are young, you may struggle to get this early diagnosis.”
If you are below state pension age (66, rising to 67 from 2028), you could be entitled to other benefits, including personal independence payments, which are designed to support people of working age who have daily living or mobility needs. Eligibility depends on your needs, not your diagnosis, and the payments are not means tested.
You can get payments from £28.70 to £184.30 a week, but you may have to be assessed at regular intervals to see if you are still eligible.
If you are above state pension age you may be entitled to Attendance Allowance instead, depending on your needs. This is £72.65 a week for those who need help during the day or at night and £108.55 a week for those needing help both during the day and night or who are terminally ill.
Someone caring for someone with dementia for at least 35 hours a week may also be eligible for carer’s allowance of £81.90 a week.
Scams
It is important to let your bank or building society know if you have dementia. Registering your condition will mean that additional checks will be in place to ensure that you are not tricked into transferring funds to a scammer. A bank is more likely to refund you if it failed to stop a scam, knowing of your condition.
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