5 ways you can help someone with dementia look after their finances

A woman helps an elderly woman as she looks at her bills.

If you have had a direct experience with dementia, either personally or with someone close to you, you will know what a devastating disease it is and how it can make even the smallest tasks become an insurmountable challenge.

The NHS estimates there are around 944,000 people in the UK who have dementia, with 1 in 11 people over the age of 65 having a diagnosis. By 2030, it is estimated that over 1 million people will have dementia in the UK.

The number of people with dementia is rising because people are living longer.

The Alzheimer’s Society reports that dementia is one of the most expensive conditions to care for and estimates that it costs the UK around £34.7 billion a year, which works out as an average annual cost of £32,250 per diagnosis.

There are several small but impactful ways you can help someone with dementia, which may seem minor to you but could make a world of difference for them.

So, with Dementia Action Week taking place between 13-19 May, here are five ways you can help someone with dementia look after their finances.

1. Help them to organise their regular outgoings

There are regular expenses that a person with dementia may struggle to manage independently, which could be easily organised by someone with their full mental capacity.

For example, you could set up a weekly shop delivery with a direct debit that ensures all their essentials are delivered on time and saves them from having to remember where the shop is or what they might need to buy.

You could similarly manage their subscriptions and outgoings by setting up a standing order or direct debit to pay for things like their television license fee or household bills.

It may also be a good idea to inform their bank of their condition and find out if any alternative methods of authorisation could be arranged. For example, some banks can supply a chip and signature card for clients who cannot memorise their PIN.

And you might consider setting up a third-party mandate, which allows you to make everyday transactions from one account on behalf of someone else. Alternatively, you could open a joint bank account that you both have access to.

2. Register a Lasting Power of Attorney

People with dementia or other illnesses that impair their cognitive faculties may reach a point where they are no longer able to make decisions about their care or their finances.

A Lasting Power of Attorney (LPA) is a legal document that appoints one or more individuals to make decisions on behalf of someone who has lost the mental capacity to make informed decisions for themselves.

There are two forms of LPA:

  • Health and welfare – this type of LPA allows you to make decisions about the care and treatment of the individual you are acting on behalf of. A health and welfare LPA can only be used when the individual has lost their mental capacity.
  • Property and financial affairs – this type allows you to manage and make decisions regarding the individual’s bank accounts, bill payments, benefits, pension, and property. A property and financial affairs LPA can be used before the individual has lost their mental capacity.

It is important to remember that you can only put an LPA in place when you still have mental capacity. So, it is wise to speak with family and loved ones before it is too late.

3. Manage their benefits (and yours)

People with dementia may be eligible for certain benefits, though they might not be capable of understanding which they can claim and how to claim them.

If they need help at home, they may be eligible for either:

  • Attendance Allowance – this is for people over State Pension Age who need help at home, and can be claimed regardless of their income or savings.
  • Personal Independence Payment (PIP) – this is for people under State Pension Age who need help at home, and can also be claimed regardless of their income or savings.

If they receive Attendance Allowance, they may also be entitled to other benefits, such as Pension Credit, Housing Benefit, or Council Tax Reduction, though these will depend on their income and savings.

Moreover, if you are providing regular care for someone with dementia, you may be eligible to claim either the Carer’s Allowance or Carer’s Credit, depending on how much time you dedicate to their care.

4. Help with their care fees

Unless you have assets less than the upper capital limit (UCL) of £23,250, the local authority will not support your care costs.

The UCL is expected to rise to £100,000 in October 2025 as part of wider reforms to social care, though the reforms have already been delayed from the original date in October 2023.

If you are helping someone with dementia, you may need to determine ways they can pay their care fees.

This might involve examining their pension schemes and considering withdrawals, looking at any of their saleable assets (such as cars or property), or understanding any investment income they may have.

5. Talk to a financial planner

A financial planner can work with you to manage finances that another individual has entrusted to you.

They can help to ensure your own financial plan is not impacted by your care duties and to create a plan for any future care needs you may require.

Get in touch

A financial planner can help to make sure that you or your loved one are well prepared to deal with the costs and management of dementia.

To speak to a financial planner, get in touch.

Email info@blueskyifas.co.uk or call us on 01189 876655.

Please note

This blog is for general information only and does not constitute advice. The information is aimed at retail clients only.

A pension is a long-term investment. The fund value may fluctuate and can go down, which would have an impact on the level of pension benefits available. Your pension income could also be affected by the interest rates at the time you take your benefits.