Start With Reviewing Your Current Estate Plan

Many people create a will or trust and then never look at it again. If your documents were drafted some time ago, they may no longer reflect your wishes—or current law. After a dementia diagnosis, the first step is to review your estate plan and confirm:

• Who inherits, and in what manner

• Who is named to act on your behalf

• Whether your documents align with your current values, goals, and family relationships

One of the biggest issues we see is outdated designations on who will act onyour behalf. Younger adults often name parents or siblings as power of attorney or trustee. Years later, as life evolves, the better choice may be an adult child, a trusted friend, or a professional fiduciary. Now is the time to correct that.  If one spouse has received a dementia diagnosis, the other spouse may also want to update their documents to ensure their agents do not include a spouse who can no longer serve in that role.

Reevaluating Trustees and Adding Support

If you have a trust, it is often wise to add a co-trustee—usually a child or trusted advisor—so someone else can legally assist with managing accounts, paying bills, or making financial decisions.

Depending on the severity and progression of the dementia, the diagnosed spouse may want to resign as trustee. This prevents future confusion, mismanagement, or unintentional financial harm when cognitive symptoms worsen. When trustees change, financial institutions must be notified so the new trustee has full, lawful authority.

Add Trusted Contacts and Organize Your Financial Information

Many financial institutions now offer the option to name a trusted contact. This gives your bank, investment firm, or brokerage someone they can reach out to if they detect suspicious activity or have concerns about your cognitive ability.

In addition, one of the greatest gifts you can give your family is a clear list of your assets—accounts, insurance policies, property, online accounts, and important documents. When families don’t know what exists, they spend months tracking things down.

Review How Your Property Is Titled

A dementia diagnosis is also a good time to confirm your assets are titled correctly for probate avoidance and tax planning.

In some situations—especially when one spouse has a shorter life expectancy—it may make sense to retitle appreciated assets into that spouse’s name to secure a step-up in basis at death. This strategy can reduce capital gains taxes for the surviving spouse.

But this must be done very carefully. Medicaid eligibility, inheritance rights, and tax consequences all play a role. Do not retitle assets without speaking to an estate planning attorney first.

At Yanowitz Law Firm, we regularly help families evaluate these decisions and determine the safest path forward.

Planning for Special Assets and End-of-Life Wishes

If you own a family cabin, a business, investment property, or other legacy assets, consider whether the next generation should begin taking over ownership or management. Transitioning early can prevent confusion later.

It is also an appropriate time to communicate funeral preferences or prepay certain arrangements. Your family will be grateful to have clarity during an emotional period.

Frequently Asked Questions

1. Can someone with early-stage dementia still update their estate plan?

Yes. As long as they still have legal capacity—which is common in early stages—they can update documents. Acting sooner rather than later is essential.

2. Should the spouse with dementia resign from financial roles immediately?

Not always. An attorney can evaluate the situation. Often adding a co-trustee or co-agent is enough at first, with resignation coming later if needed.

3. What if no one knows where the person keeps financial documents?

This is extremely common. Start organizing all accounts, titles, and policies now. Our firm can help families create a secure, comprehensive asset list.

Author

Claire creates wills and trusts which provide security and peace of mind. She compassionately listens to her clients’ dreams, goals, and fears and then fashions plans that best meet their needs.

It is important to Claire that her clients understand different options and make decisions that are right for them. She loves to educate clients by drawing out complicated concepts.

Come visit us! Conveniently located in Rochester, Minnesota.