Your five-minute guide to dementia-proofing your money to ‘safeguard your future’ | Personal Finance | Finance

Around 950,000 people in the UK have dementia, with almost one in 10 over-65s affected. As people live longer, cases are rising fast, and by 2030, more than a million people are expected to be living with the condition.

In the early stages, many can still manage their finances. But as it progresses, changes in memory, judgement and decision-making can make even simple tasks difficult. Bills get missed, accounts are forgotten, and risks increase. That is why experts say acting early is crucial.

Sangita Manek, partner at law firm Irwin Mitchell, said as we live longer, the likelihood of developing dementia or other forms of cognitive decline increases. “There may come a point where managing your finances becomes difficult, and matters may slip out of your control. Dementia-proofing your money while you have capacity is therefore one of the smartest acts of self-protection you can take.”

The key is to start early, long before any signs of cognitive decline. One of the simplest steps is to automate as much as possible. Setting up direct debits for household bills, savings and credit cards reduces the risk of missed payments.

Consider legal advice too. Arranging or updating your will ensures assets go where intended and in a tax-efficient way. Setting up a Lasting Power of Attorney is just as important. This allows a trusted person to make decisions about finances, property and healthcare if your mental capacity declines. Without one, families can face delays and additional costs as they try to take control.

Simplifying finances can also make a big difference. Consolidating accounts, especially pensions, makes management easier. Banks can help too, offering spending alerts, withdrawal limits and other tools to protect against financial abuse if someone becomes vulnerable.

Keep organised financial records in the same place, with digital backups, and make sure loved ones know where to find them. This can prevent worry later, Manek said. “Let your appointed attorneys and family know your intentions. Written instructions or even a short video can clarify your preferences and prevent any disputes”.

Planning ahead for care costs is also key, whether through savings or insurance, to avoid financial strain later.

If a diagnosis has already been made, acting quickly is still critical. Reviewing or writing a Will should be a priority, especially as more than half of adults aged 50 to 64 do not have one. Planning for care costs early gives more options and control. Notifying banks can unlock support services designed for vulnerable customers, adding an extra layer of protection.

There may also be financial help available. Checking eligibility for benefits, local council support, and adult social services can ease the burden. These schemes can help cover care costs and provide practical assistance.

At heart, dementia-proofing is about anticipating that it may happen to any of us, and taking steps in advance to protect your dignity, independence, and legacy, Manek said. “Taking these steps can help maintain control over your finances for as long as possible, reduce stress on your loved ones, and safeguard your future.”

Alexandra Milton, an estate planning expert at regional law firm Knights, said that drawing up a will has financial advantages, too. “It can safeguard children’s inheritances, support vulnerable beneficiaries, and maintain a surviving partner’s standard of living.”