Dementia is an overall term for diseases and conditions characterized by a decline in memory or other thinking skills. Currently 5.2 million Americans are living with Alzheimer's and by 2050 that number is estimated to triple over to nearly 14 million people. In addition to the devastating psychological toll dementia takes on the individual and the family, it is also one of the most expensive diseases. Making sure that your family is able to take care of your finances and your medical decisions before dementia strikes at its highest level, is extremely important. What is also important to understand is that individuals who have been diagnosed with dementia are not necessarily incompetent. In fact, many individuals who are diagnosed with dementia will still be able to understand what they want to accomplish with a Will or Trust and who they can rely on to act on their behalf.
When setting up an estate plan for an individual that has been diagnosed with dementia, a lawyer has a duty to determine the client’s capacity to execute documents. Michigan law automatically presumes adults have capacity. However, each individual with dementia approaches the estate planning process with a different level of dementia. The factors that need to be considered when setting up an estate plan for someone diagnosed with dementia include the following:
1. That the individual has the ability to understand that he or she is providing for the disposition of his or her property after death
2. The individual has the ability to know the nature and extent of his or her property
3. The individual knows the natural objects of his or her bounty
4. The individual has the ability to understand in a reasonable manner the general nature and effects of his or her act in signing the will or estate plan
Waiting until an illness, such as dementia, to occur is obviously not the ideal time to do your estate plan. However, it is important for families to know that even if there is a diagnosis of dementia, there may still be time to get everything in order.
Goudy Bookletter 1911