1. Start Early – The Time to Plan is NOW

Estate planning should begin while your parent can still legally make decisions (while they have legal capacity).

Action Steps:
✔️ Initiate the conversation NOW—waiting increases legal risks.
✔️ Assess their cognitive state—get a medical evaluation if needed.
✔️ Discuss financial, legal, and medical wishes.

2. Set Up a Living Trust to Avoid Probate & Manage Assets

A living trust is a legal entity that holds assets like property, bank accounts, and investments.

Unlike a will, a trust:
✔️ Bypasses probate, avoiding costly and time-consuming court processes.
✔️ Protects assets from mismanagement and financial exploitation.
✔️ Ensures seamless financial control if your parent becomes incapacitated.

Pro Tip: Assign yourself (or a trusted family member) as co-trustee so you can legally manage assets as soon as needed.

3. Establish Financial Power of Attorney (POA)

Once dementia progresses, your parent may lose the ability to make financial decisions.

A financial POA allows a trusted individual to:
✔️ Helps prevent future resentment or misunderstandings.
✔️ Gives you new perspectives you may not have considered.
✔️ Makes your family feel included, rather than just informed.

Without a POA, you’ll need a court-appointed guardianship—a long and expensive legal process.

4. Assign a Healthcare Proxy for Medical Decisions

A healthcare proxy (also known as medical POA) ensures your parent’s medical preferences are honored.

This allows the designated person to:
✔️ Make critical medical decisions
✔️ Choose long-term care options
✔️ Advocate for your parent’s healthcare rights

5. Draft a Family Caregiver Agreement

If you’re providing daily care, a formal caregiver agreement helps prevent financial misunderstandings.

This legally binding contract outlines:
✔️ Compensation for caregiving services
✔️ Expense reimbursement for medical/travel costs
✔️ Expectations for daily care responsibilities

Pro Tip: This document also helps protect Medicaid eligibility by showing a legitimate caregiver arrangement.

6. Plan for Long-Term Care & Medicaid Eligibility

Dementia care is expensive—with assisted living and nursing home costs averaging $5,000-$10,000 per month.

Plan ahead to cover costs through:
✔️ Medicaid planning—restructure assets to qualify for assistance.
✔️ Long-term care insurance—if still eligible.
✔️ Veterans benefits—if your parent served in the military.
✔️ Life insurance policy review—some policies have a long-term

Without planning, family members may be forced to cover costs out of pocket.