Research suggests that unusual financial behavior, such as uncharacteristic payments and multiple bank transfers, may serve as an early warning sign of dementia.
In the United States, approximately 7.2 million individuals are affected by Alzheimer’s disease, with one in nine people aged 65 and older living with the condition.
Common symptoms of Alzheimer’s or dementia include memory loss, but other forms of the illness can lead to hallucinations, muscle stiffness, and anxiety. There are additional, less frequently discussed symptoms related to financial behaviors.
Researchers from the New York Federal Reserve analyzed US credit reporting and Medicare data, discovering that an individual’s average credit score tends to decline and arrears increase in the five years leading up to a dementia diagnosis.
The study revealed: “The harmful financial effects of undiagnosed memory disorders exacerbate the already substantial financial pressure households face upon diagnosis.”
It was noted that early-stage Alzheimer’s disease and related disorders could affect behaviors such as opening new accounts, accumulating debt, credit utilization, and the credit mix.
Marcey Tidwell wasn’t taken aback by these results, as her mother was diagnosed with dementia in 2020.
According to CNN, Tidwell observed changes in his mother’s financial habits around 2015, noting that she had trouble maintaining her previously organized records of checks and deposits.
“There was a bunch of stuff scratched out and she was obsessively adding and re-adding—she knew things weren’t all they could be. Later on, I saw that she took out large amounts of her savings, more than she needed for groceries,” Tidwell explained.
A study conducted last year, led by Professor John Gathergood from the University of Nottingham and David Leake of Lloyds Banking Group, examined the relationship between everyday financial behaviors and early signs of cognitive decline.
It compared individuals registered for power of attorney with those who had no reported loss of capacity.
Professor Gathergood stated: “These patterns provide the first large-scale evidence that behavioral data held by financial institutions can reveal the early emergence of cognitive decline.”
He added, “It is a powerful demonstration of how anonymized banking data can be used responsibly to protect the most vulnerable members of society.”
Although there is currently no cure for dementia, early detection is vital. These studies, along with a 2020 study from the Johns Hopkins Bloomberg School of Public Health, aim to improve early detection of the disease.
The lead author of the study emphasized: “Earlier screening and detection, combined with information about the risk of irreversible financial events, like foreclosure and repossession, are important to protect the financial well-being of the patient and their families.”