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Dementia and Power of Attorney: What You Need to Know

Written by Kevin Ryan
 about the author
5 minute readLast updated May 22, 2023
Reviewed by Denise LettauAttorney Denise Lettau has over 15 years of experience in the wealth management industry.

Planning for the care of an aging loved one with dementia can be time consuming and challenging. Respecting their independence while ensuring they have the care they need is a delicate balance. Ideally, your parent should have engaged in legal planning well before they began experiencing cognitive issues. If they haven’t already, it’s important to encourage your them to create a power of attorney (POA) while they are still competent. A POA can help ensure their care and financial wishes are carried out even if they are no longer able to care for themselves. Appointing someone to act on their behalf can also help family members understand the role they will play in their care.

Key Takeaways

  1. A power of attorney is a legal document that allows a person to appoint another person to make decisions on their behalf. It’s an essential planning tool that can help a parent with dementia manage their finances and health care when they become unable to do so on their own.
  2. Creating a power of attorney may be possible after a dementia diagnosis. In some cases, a valid power of attorney document may be created in the early stages of dementia.
  3. A power of attorney must be drafted when the person with dementia is still competent. If a loved one becomes incapacitated without a power of attorney in place, managing their care and finances can become legally challenging and time consuming.
  4. Having a power of attorney drafted by an attorney is recommended. An attorney can help your loved one draft the documents that are right for your their circumstances.

What is a power of attorney?

A power of attorney (POA) document gives someone the authorization to act on behalf of another person to make legal, financial, or medical decisions.[01] The principal in a POA is a competent adult who grants a trusted individual the authority to make decisions for them should they become unable to do so on their own. The trusted individual is called the agent, and they take on the responsibility of making decisions that are in the best interest of the principal.[02]
There are several types of POA that can be customized to meet the needs of your aging loved one. There is no single POA that covers all situations, but the two most common types are a health care power of attorney and financial power of attorney.

Why is a power of attorney important for a parent with dementia?

Dementia is a progressive condition that affects a person’s mental and physical abilities. It’s common for a person in the early stages of dementia to live independently and to maintain a relatively normal lifestyle. However, their ability to care for themselves and to live safely declines as their dementia advances.[03] For this reason, it is important for a person living with dementia to have a power of attorney (POA) in place so that a designated agent (or agents) can assist them with crucial financial, legal, and medical decisions.

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Attending to your loved one’s care can be more difficult without a POA in place. A properly drafted POA may offer several of the following benefits for both you and your parent:
  • A financial POA grants the named agent legal access to the principal’s finances, which enables the agent to pay for their care, file taxes, and pay bills.
  • A health care POA, though different from a living will, grants the named agent legal access to the principal’s medical records and the ability to make medical and long-term care decisions on their behalf.
  • POA can help family members avoid confusion and possible conflict around who should handle parent’s care and/or finances.
  • It can help families avoid expensive and lengthy legal proceedings. Without a POA, managing the care and finances for a parent who has become incapacitated usually requires a guardianship or conservatorship, which can only be established by a court.

How to create a power of attorney

Your parent is responsible for initiating the process of creating a power of attorney. An adult child or caregiver cannot create a POA on a parent’s behalf.
While POA forms can be found online, it’s recommended that families consult with an elder law or estate planning attorney to draft a POA. An attorney can help your parent draft the documents that fit their unique wishes and circumstances. In addition, their competency is less likely to be questioned in the future if the document is created with the assistance of an attorney.

Steps to help your parent with dementia create a power of attorney

State laws may dictate the steps necessary for creating a power of attorney (POA), with specific language and witness requirements.[04] The steps for creating a robust, legally binding POA may also depend on your parent’s unique care needs and financial circumstances.
These general steps can help guide your family when creating both medical and financial POA documents:

Choosing a trustworthy agent

An good agent should be reliable, decisive, a strong communicator, and willing to make decisions that are in the best interest of the principal. An agent is responsible for making financial and/or health care decisions in addition to communicating with the principal’s family. The signed POA should name the designated agent, the specific powers and responsibilities they are being granted, and when these powers go into effect

How to change a power of attorney for someone with dementia

Only the principal can make changes to their own POA. For changes to be considered valid, the principal must be competent at the time of the update, just like they need to be when initially creating a POA.
Frequently reviewing an established POA is an important aspect of ensuring the document continues to reflect the principal’s wishes.

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Power of attorney after a dementia diagnosis

If your parent’s dementia diagnosis is recent, having a conversation about their future may be uncomfortable, but it’s best to do so sooner rather than later. A person in the early stages of dementia may have mild symptoms and will typically have the capacity to make decisions about their care and finances. However, they should be encouraged to plan for the time when they do not.
In many cases, it’s possible for a parent in the early stages of dementia to establish a power of attorney. However, once they are no longer competent, creating a POA is not a valid legal option.
Note that there are several aspects of creating an elder care plan for a loved one after a dementia diagnosis. Creating power of attorney documents is merely one of them.

Supporting your aging loved one with dementia

It can be challenging to know what questions to ask and where to find answers while caring for a parent with memory issues. As their needs increase, our Senior Care Advisors can offer information, help you explore a variety of care options for your loved one, and connect you with local providers.


  1. American Bar Association. Power of Attorney.

  2. Alzheimer’s Association. What Is Dementia?

  3. National Academy of Elder Law Attorneys. Durable Powers of Attorney.

Meet the Author
Kevin Ryan

Kevin Ryan is a copywriter at OurParents. He has written about Medicaid and Medicare, and focuses on creating content for caregivers. Previously, Kevin worked as a freelance writer, a special education teacher, and a counselor for adults with developmental disabilities. He earned a bachelor's degree from the University of Colorado Boulder.

Edited byKristin Carroll
Reviewed byDenise Lettau

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