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Planned for Diminished Financial Capacity

According to the SEC, “’Diminished financial capacity’ is a term used to describe a decline in a person’s ability to manage money and financial assets to serve his or her best interests, including the inability to understand the consequences of investment decisions.”

Of all the things we plan for, it’s likely that we’re least interested in and least likely to plan for diminished capacity. The thought of losing one’s mental capacity is, for some, a fate worse than death, but, it’s something that shouldn’t be ignored. According to the World Health Organization, a new case of dementia is diagnosed at an average of 1 new case every 3 seconds. As a result of this, everyone should take steps to organize and prepare their financial records and documents in the event that someone needs to provide support.

Because we’re so fearful of having a diminished capacity, we might be fearful of telling others when we notice changes in ourselves. Don’t be. Things won’t get better by hiding them from your loved ones.

Here are some steps you can take to prepare your finances in the event you need someone’s help:

Get organized- Pull together all of your financial documents in one place. It might be best to provide your attorney with a list of accounts as well. These documents will include:

Paychecks

Pension Statements

Social Security Statements

Mortgage & Other Liabilities

Investments

Checking/Savings/CDs

Insurance (health, life, long-term care, homeowners, etc)

Estate Plan

Names, addresses, and phone numbers of your CPA, Attorney, and Financial Advisor.

Communicate– Let your spouse and/or children know where your financial documents are stored and who your CPA, attorney, and financial advisor are. You may want to have your spouse/children be involved in your appointments or receive duplicate statements so that they’re familiar with your financial picture. Involving your family will also help them monitor your accounts for unusual activity.

Additionally, tell your financial professionals so they can help monitor your finances. Also, let your advisers know who your trusted family/friends are so everyone can be kept informed of any unusual financial activity.

Create a financial durable power of attorney– this will allow someone to step in and help you with your finances should you find yourself unable to do so (this could be due to a health issue or even if you’re out of the country and need emergency funds). If you have a power of attorney document, you may want to get that on file with your financial institutions.

Many of these are wise pieces to put in place whether there’s diminished capacity, another health emergency, or as part of your estate plan. A little extra work for you today could save someone else countless hours of effort later.

Anyone who has assisted with the finances for a grandparent, parent, or spouse as they transitioned to a nursing home or after they passed away understands how difficult it can be to track down accounts, bills, and assets for someone else. Some people are literally pulling up floorboards checking to see if grandma stashed her extra cash there for safekeeping.

If you have a loved one with dementia, the World Health Organization has an online program to provide you with support and training. Learn more here.

Contact us if you’d like to learn more about how to prepare for diminished capacity or the warning signs.

The opinions voiced in this material are for informational purposes only and are not intended to provide specific advice to any individual. Consult your legal, tax, and/or financial advisor to determine what is appropriate for your situation.

PWM

Events & Sponsorships

October 3rd

Mark your calendar for the 14th Annual Paws for a Cause Charity Night & Silent Auction. This year, Paws will be held on Thursday, October 3, 2019 from 5-8PM at Monument City Brewing Company. This event will benefit The Buddy Foundation of Maryland, Community Cats of Maryland, and Furry Friends Network. 

The 14th Annual Paws for a Cause will feature guest bartenders, brewery tours, animals brought by the charities, a silent auction, raffles, games, a food truck, & more!

The Buddy Foundation of Maryland provides the financial and emotional support necessary to prevent euthanasia and/or surrender of a canine family member due to the high cost of urgent veterinary care.

Paws for a Cause is raising money for The Buddy Foundation of Maryland to help them provide financial support to 3-4 families with pets in need of urgent medical care.

Community Cats of Maryland is dedicated to helping feral cat caretakers pursue TNR. Community Cats of MD provides resources, information, and support to Maryland residents who are caring for outdoor/feral cats. They offer educational workshops about feral cat management and TNR and they run monthly low-cost spay/neuter clinics for feral cats.

Paws for a Cause is raising money to help support Community Cats of MD’s efforts to relocate, vaccinate, and medically treat the feral cats living at the former site of Bethlehem Steel. As many as fifty cats could still be living there.

Paws for a Cause also gives back annually to the Hope Fund of Furry Friends Network, Inc as a token of appreciation for bringing Fenway into the lives of founders Woody and Heidi Derricks. If it wasn’t for their experience with Furry Friends Network, Paws for a Cause wouldn’t exist.

Learn more about the event here and follow Paws for a Cause on Facebook for updates.

Away from the Office

August 15th   

Woody will be out of the office. If you need assistance, please contact Debbie at 410-732-2633 or at debbie@partnershipwm.com.

We are always accepting donations for the local animal shelters– toys, tennis balls, collars, leashes, food, cat litter, cardboard trays, office supplies, cleaning supplies, towels, mats, washcloths, etc. We will accept donations Monday-Friday between 9am & 5pm.

 

Family

Elise took her first swim lesson this month. Initially, she was reluctant to part with her floaties, but, after a few successful jumps from the stairs and into the arms of her instructor, Elise was beaming. By the end of her lesson, Elise had learned to hold her breath while gliding through the water, practiced floating on her back, and was kicking her legs like a pro. She had so much fun that the kid who hates getting her picture taken was asking if we took any videos.

Roxy has been a bit of a worrier of late. She’s started to become anxious when she and Fenway are left alone at the house and is being destructive. She even attacked some of Elise’s toys one evening to which Elise asked if we could explain to Roxy that it’s upsetting Elise and tell her to stop. It pulls on the heartstrings to see both of our girls sad, but it’s reassuring to know that Elise understands the value of communication. If only it was that easy to have Roxy feeling calm. I didn’t expect to be taking an 11 year-old Roxy to a dog trainer, but here we are. Hopefully, we’ll find a way to help Roxy be at ease while we’re away.

I hope you enjoyed this month’s newsletter.

Best Wishes,

Woody Derricks, CFP®, ADPA®

President