June 12, 2024
Falling behind on credit card bills and mortgage payments may be an early sign of Alzheimer’s disease, according to a new report. The study found that a decline in credit scores and other uncharacteristic money troubles may be a prelude to a dementia diagnosis.
“Most memory disorders aren’t diagnosed until symptoms are severe, yet, given the progressive nature of disease, cognitive decline usually starts many years prior,” said study author Carole Roan Gresenz, a health economist at Georgetown University. “The earliest changes in cognition might not be noticeable by family members and friends, but may be quietly compromising financial decision-making.” The findings were released in a report from the Federal Reserve Bank of New York.
For the study, researchers looked at financial records from Equifax, a credit rating service, and compared them with medical records from Medicare, the government health program for Americans 65 and over. They had records of a nationally representative sample of more than 2 million older Americans with chronic health conditions (their identities were left anonymous) over many years. About 20 percent were eventually given a diagnosis of Alzheimer’s or other forms of dementia.
The researchers found that in the year before a diagnosis of dementia, individuals were 34 percent more likely to fall behind on credit card payments, and 17 percent more likely to be delinquent on mortgage payments compared to their peers without a dementia diagnosis. Overall, financial troubles started more than five years before a diagnosis and escalated in the months leading up to it.
“The financial decline we observe mirrors the cognitive decline that these individuals are experiencing,” Dr. Gresenz said. “Credit scores consistently decline, quarter by quarter, and probability of delinquency consistently increases as diagnosis approaches.”
The findings underscore how Alzheimer’s can impair thinking skills even years before memory loss and other symptoms become apparent. The researchers say that people should be on the lookout for financial irregularities among friends and family members as a possible early warning sign of Alzheimer’s. People with failing cognitive skills may show an increase in impulsive purchases or invest in risky ventures they would not have previously considered. While many people who have new financial irregularities will never get a diagnosis of dementia, it could be an early warning sign for some.
“A diagnosis of this type can be financially disruptive to families and exacerbated by the harmful financial effects of undiagnosed memory disorders,” Dr. Gresenz said. “Our findings substantiate the possible utility of credit reporting data for facilitating early identification of those at risk for memory disorders.”
The work builds on previous research showing that people in the early stages of Alzheimer’s disease are at heightened risk of money troubles. A study from 2019, for example, found that older men and women who are cognitively “normal” but who are prone to falling for financial scams and other forms of financial fraud are at heightened risk of developing Alzheimer’s disease years later. They are also at heightened risk of developing mild cognitive impairment, or MCI, a brain disorder that can progress to full-blown Alzheimer’s disease.
The AARP warns that criminals have many ways to prey on the elderly. They may pose as agents of the IRS or of Medicare, or as debt collectors. They may even pose as a victim’s grandchild, calling late at night or emailing to get the elderly person to wire emergency funds for a grandchild in distress.
The findings underscore the importance of making sure that patients with Alzheimer’s and their families promptly pursue financial planning and transfer financial responsibilities for someone in the early stages of Alzheimer’s disease. Proactive steps by families include finalizing trust and estate arrangements, delegating financial decision-making powers, planning for eventual financial incapacity, and providing increased supervision of existing financial activities.
By ALZinfo.org, The Alzheimer’s Information Site. Reviewed by Eric Schmidt, Ph.D. Fisher Center for Alzheimer’s Research Foundation at The Rockefeller University.
Source: Carole Roan Gresenz, Jean M. Mitchell, Belicia Rodriguez, et al: “The Financial Consequences of Undiagnosed Memory Disorders.” New York Federal Reserve Bank, May 2024
