James Sullivan
James Sullivan

Stricken With Alzheimer’s: Financial Planning for the Patient and Family

A growing number of families need financial guidance due to Alzheimer’s disease.

May 10, 2010
by James Sullivan, CPA, PFS

The interest in protecting senior investors by the U.S. Securities Exchange Commission (SEC) and the Financial Industry Regulatory Authority (FINRA) has increased in recent years. Due to the aging of the U.S. population both FINRA and the SEC view the protection of senior investors as a top priority. This concern for senior investors was again the focus on March 10th at the first meeting of the Alzheimer’s Association Financial Advisory Council. The meeting was sponsored by the FINRA Investor Education Foundation and the Alzheimer’s Association.

The purpose of this meeting was to ask council members to begin addressing issues relating to the financial impact on a family of Alzheimer’s disease. Specifically, members asked to identify the financial needs of the family and the resource needs of financial professionals working with these families. The author attended as a member of the AICPA PFP Section’s elder planning task force. Also attending the meeting were representatives of many of the largest U.S. insurance and brokerage firms and members of the academic community.

For advisors serving the senior market, it is essential that they understand the cognitive challenges that seniors often face. Assisting the seniors and their families with planning for the financial impact of these health problems will constitute a growing part of the advisor’s practice. It will also be important for advisors to understand the practice implications of serving seniors and the regulatory issues. In this article we review the regulatory background and the impact of Alzheimer’s disease on one of its younger victims.

Alzheimer’s Disease

Alzheimer’s disease is a progressive degenerative disease of the brain that causes impairment of memory and other cognitive abilities eventually resulting in death. Although it primarily impacts the elderly, it is not considered a normal part of aging and as John McClelland’s story below demonstrates, younger people do fall victim to the disease. It is a myth that only seniors are stricken with Alzheimer’s disease. As explained at the Alzheimer’s Association website:

“Alzheimer's can strike people in their 30s, 40s and even 50s. This is called younger-onset Alzheimer's. It is estimated that there are as many as 5.3 million people living with Alzheimer’s disease in the United States. This includes 5.1 million people age 65 and over and 200,000 people under age 65 with younger-onset Alzheimer’s disease.”

Alzheimer’s disease is a type of dementia. There are more than 70 diseases and conditions that can cause dementia. According to the Alzheimer’s Association’s 2010 Alzheimer’s Disease Facts and Figures,Alzheimer’s accounts for 60 percent to 80 percent of all cases of dementia. Dementia itself is a set of symptoms including memory decline and impairs at least one of the following: ability to speak or understand speech; ability to recognize objects; ability to execute motor activities; ability to think abstractly. To say someone is demented only means they exhibit a set of symptoms, it does not by itself identify the cause of the dementia.

Background and Resources

The SEC, FINRA and the North American Securities Administrators Association (NASAA) have issued a variety of papers and other resources on serving the aging population and protecting senior investors. Examples include:

The Financial Advisory Council

This meeting on senior investors was different from earlier meetings because it focused on a specific disease and the related financial planning needs of the patient and their family.

One speaker in particular had a tremendous emotional impact on the attendees. John McClelland is a member of the Alzheimer’s Association’s Early Stage Advisory Group. In 2007, McClelland was diagnosed with younger-onset Alzheimer’s at the age 55. Betsy, his partner and he had plans to be married when he was first diagnosed. Fearful of the financial obligations that Betsy may be responsible for as the spouse of an Alzheimer’s patient, they canceled their plans to wed. Still devoted to each other, Betsy is his primary caregiver.

McClelland was no stranger to Alzheimer’s. His mother, grandfather and an uncle were all Alzheimer’s victims. He first detected a problem when he began to re-introduce himself to people he had just met at business meetings. Betsy recognized that there was a problem when he began repeating himself. John also experienced problems as a volunteer fireman. He could not clearly describe the scenes he witnessed due to excessive word substitution. Inability to find the proper word, e.g., calling a watch a “hand-clock,” memory changes and repeating themselves are all signs of Alzheimer’s disease (for more information see Know the 10 Signs: Early Detection Matters).

Because of his familiarity with Alzheimer’s, McClelland was better prepared than most for the onset of the disease. He owned long-term-care insurance as well as a disability insurance policy. He can no longer work as a technology product marketing manager. He knows very well what lies ahead for him and Betsy as the disease progresses. For the attendees, he puts on a courageous human face on this devastating disease. His advice to financial advisors: Do whatever you can to encourage your clients to plan ahead before the diagnoses. It is increasingly important for financial advisors to understand the cognitive challenges of aging and make sure their clients are properly prepared.


Alzheimer’s disease is just one example of a chronic disease that can devastate a family financially. CPAs are in an excellent position to assist with this type of special-needs planning and can help relieve at least some of the stress these challenges bring to the client and their family. There are a growing number of resources available to CPAs who work with older clients. In addition to the guidance provided by the SEC and FINRA, see the article in the January issue of the Journal of Accountancy CPAs in an Aging Society: When Alzheimer’s Disease Affects a Client for a discussion of the practice implications of working with a client who may suffer from Alzheimer’s.

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James Sullivan, CPA, PFS, MAS, is an investment counselor at Core Capital Solutions LLC. He has almost 25 years of experience in individual tax, investing and personal financial planning. Before joining Core Capital Solutions, Sullivan spent 20 years at Arthur Andersen LLP. He is a member of the AICPA PrimePlus/ElderCare Task Force. PFP Section members, including PFS credential holders will benefit from additional Medicare resources in Forefield Advisor on the AICPA’s PFP website at aicpa.org/pfp. Non-members can click here to join the section.