When working with clients with dementia, the tendency is to tell them what to do, Starnes says. Instead, the client should be allowed to make some decisions so he or she still feels in control. For one client, who was spending thousands of dollars redecorating her house every three months, the family set up a bank account with $1,000 a month for the client to spend as she wished.
“That allowed her to make whatever decisions she wanted, but she was no longer endangering her future,” he says.
Another technique Starnes says he has developed is to ask cognitively impaired clients "either or" questions, not open-ended questions, when trying to determine what they want.
“Financial advisors and family members must not dismiss it when they see signs of confusion or disorganization in a client or loved one. They cannot just hope it will go away. It won’t. We must all recognize it as something that will get worse,” he warns.
A client of Starnes recently brought a friend to see him when the friend suspected a problem existed. The friend had cashed a $400,000 IRA and moved it to a new advisor for investment.
“He paid a $100,000 tax bill on that money and there was nothing that could be done about it,” he says. “We can prevent that kind of thing if we suspect there might be problems ahead of time. Unfortunately, the first signs of dementia often are seen in the financial area.”