Technology, Aging, and Financial Capacity
Financial Capacity Widera et al., 2011 • Manage personal finances • Independently
• Personal self-interest
Physical Challenges • 65 >: Physical/vision/hearing loss • 75 >: 25% experience difficulty walking short distances 6% don’t leave home more than weekly Average 75 year old takes 5 prescription medications Arthritis: nearly 70% of people 75+ require help with ADLs
• 85>: 1in 3 with dementia
• Stroke: 50,000 annually and 75% left with some disability
Cognitive Challenges • 500,000 in Canada with dementia • 20% over 65 are experiencing Mild Cognitive Impairment • 10% convert to dementia annually “The ability to manage finances is one of the first IADLs to decline in MCI and AD and it becomes progressively impaired. (Widera, et al., 2011).”
MCI Research Indicates • • • • • • •
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One of the first IADLs to decline May appear as early as ten years prior to a diagnosis of dementia Substantially impaired at the level of MCI in 3 domains of financial management conceptual knowledge, bank statements, and bill payments Cognitive skills of attention and executive function are more strongly correlated with financial ability than memory Accelerates quickly once identified Lack of awareness of declining abilities By mild AD, 91% assessed as financially incapable with inability in 8/9 financial management domains and 12/18 financial tasks Marked decrease in ability to recognize simple fraud schemes Replicated in at least six research projects utilizing different sample sizes and using two different methods of assessment
Financial Ability & MCI/AD Spectrum
Why’s and How’s of Assistance •
Top reasons for seeking help included lack of confidence, dementia or confusion, and disability or poor health (75%)
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Leading tasks they sought help with included paperwork, paying bills, and accessing money or banking
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The most frequent processes used by those providing assistance included powers of attorney, bank arrangements such as joint accounts, and paying with own money with reimbursement later
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43% reported sharing of PIN numbers
Utah Financial Exploitation Study • • • • • •
Reviewed eighty verified cases in 2010 Amount stolen is $6,820,265 Average loss $96,309; largest $869,924 About a third of the cases involved victims with dementia Average age 79 Not only are family members the perpetrators in more than half the supported cases, children are exploiting 85% more than the average amount lost in each case. Most often, seniors were exploited because they needed help with their finances
Barriers to Creating Technological Solutions •
Unaware of declining ability and 30% to 60% of physicians will not reveal a diagnosis of dementia or MCI
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A deceased ability to manage technology
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Non-stigmatizing
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Require minimal new learning
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Accommodate physical disabilities
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Reduce choice(s)
Reducing Dependency • • • • • • • • •
5 areas: ATM’s and PIN Technology, Account Flagging, Telephone Banking, Cash Accessibility, and Paperwork Management Introduction of multiple debit cards/Flash debit cards More frequent statements Alternatives to joint accounts with rights of survivorship. i.e. convenience accounts, Totten Trusts Promote auto bill payments Flagging of unusual account activity Provide option to avoid automated options for telephone banking Simplified paperwork Reduce steps in each transaction whenever possible
Wells Fargo
Consequences of Lack of Financial Capacity • Loss of independence and self-esteem • Is closely linked to legal issues – legal capacity, guardianship
• Legal incapacity may ultimately work to protect patients from financial harm • But may also unfairly result in a loss of autonomy and financial independence
Incapacity, Equity & Vulnerability Margaret Hall: Capacity, Vulnerability, Risk, and Consent: Personhood in the Law. • Sources of vulnerability with respect to financial capacity, rather than blanket incapacity • Vulnerability can be internal or organic and lead to constructed and situational vulnerability • Reviewed suggestions as to how to reduce that vulnerability and I think premature dependency • Technological banking solutions can support the individual and legal tools we have • Implementation of these suggestions can reduce situations of undue influence and unconscionable transactions
Old Problem…New Solutions Old age will only be respected if it fights for itself, maintains its rights, avoids dependence on anyone, and asserts control over its own to its last breath. Cicero 44 BC
