If you lose your keys or forget where you park your car from time to time, you may chalk it up to the remnants of old age. You may not even consider that these forgetful moments may carry over to how you manage your finances in your golden years.
Nevertheless, elderly Americans are vulnerable to being duped into financial scams or being bullied into paying bills that they cannot afford or may not owe. Overall, it could be a major adjustment for people who have been financially stable (and responsible) for most of their lives.
Even more telling, a Texas Tech University study, highlighted some disturbing trends regarding the elderly. Essentially, a person’s decision-making functions as it pertains to their finances tends to peak once they reach the age of 50. As a person continues to age, these abilities begin to decline by around age 60. By the age of 80, these same abilities may be severely impaired.
This does not mean that every person’s mental capacities are hopelessly destined to fail at the same time. After all, there are a number of shrewd investors who can protect themselves well into their 80’s.It is important to know that an estate plan can help in limiting the risk for being taken advantage of.
This is why an estate plan is important. Through such a plan, an elderly person can assign someone trusted to be a proxy or representative when it comes to making financial decisions. If you have questions about how a loved one’s finances can be protected, an experienced estate planning attorney can help.