Planning for the financial fallout from a fatal disease -- Page 2

Also look into instituting power-of-attorney and rearranging your loved one's financial benefits. If any accounts are solely in the name of your loved one, the family may want to change it to a joint account. "You don't want him to be the sole signer on any account," says Denver financial planner Hesselgrave.

You may also want to rearrange assets so your loved one can get the maximum benefit of such government programs as Medicaid. Investment adviser Charney recalls a client whose sister was diagnosed with Alzheimer's. Charney recommended that his client have his widowed sister transfer the glut of her estate to him.

"He uses that account to pay for her care. It's legally out of her name," Charney says. "There are timelines and rules involved which we adhered to by getting an elder care attorney involved. This isn't something you want to try and do yourself. Don't try to be a shade-tree mechanic. What you need is an elder care attorney who will make sure that you walk the line."

Don't forget the tax implications of your financial moves. If you're now the provider for your mother, she is your dependent and can be claimed on your income tax return as a deduction. Your mother's prepayment of funeral expenses can also reduce her income and serve as a qualified tax deduction, Hesselgrave says.

Explore outside assistance
You are not alone. Organizations such as the Alzheimer's Association can help you with planning, advise you on resources, and give you contact information about a local chapter.

Review government financial resources, including your loved one's potential eligibility for Medicaid, Medicare, Social Security disability income, veteran's benefits and local public assistance.

Community resources that can help include Meals-on-Wheels and Visiting Nurses, according to the Financial Planning Association.

Remember the human factor
All this planning assumes that your loved one accepts the diagnosis. Sometimes that won't happen.

Often a person will deny he or she has Alzheimer's or another debilitating or fatal illness. In these cases, the person likely will resist your efforts, no matter how well-intentioned. Or your loved one may not be competent to make financial decisions.

In such situations, the family must step in and petition the court to declare the loved one incompetent. This isn't fun, but it's necessary so the loved one is taken care of financially. Again, working with an attorney who specializes in elder care and knows the ropes can be a boon.

In cases where the loved one is in denial about the disease and its impact, Louisa Guthrie, senior vice president of Wells Fargo Private Client Services in Chicago, recommends putting assets in a trust. That trust can be overseen by a family member or a corporate trustee or, better yet, by a combination of the two.

"That will help retain the closeness and familiarity with the loved one that the family wants, but at the same time will have someone who is unbiased overseeing the trust," Guthrie says.

And don't forget to take care of yourself, financially as well as physically.

While it may be tempting for caregivers to cut back work hours or even quit a job so they provide more direct care for an ailing loved one, financial planning experts warn that such moves could hamper your ability to save for your own retirement and future health care needs.

Jenny C. McCune is a contributing editor based in Montana.