Who Pays for Care When a Loved One Has Dementia?

Dementia is not only a memory condition. It can affect judgment, behaviour, and a person’s ability to carry out basic financial and legal tasks. This often happens gradually. One day someone might forget to pay a bill; months later, they may not recognise a scam phone call or remember their PIN number.

In England and Wales, the Mental Capacity Act provides a legal framework to determine whether someone has the mental capacity to make specific decisions. The law recognises that capacity is task-specific. A person may still decide what they want for lunch, but struggle to understand how to pay a utility bill.

Once someone is judged to lack capacity, decisions about their care and finances may need to be made on their behalf.

Without a valid LPA in place, decisions can’t legally be made on someone’s behalf unless the Court of Protection intervenes. The court may appoint a deputy, who is given similar powers to an attorney but is monitored more closely. This is usually reserved for situations where no suitable arrangements were made earlier, or where disputes have arisen.

It’s also possible for the court to appoint a guardian (also known as a deputy for personal welfare). This person becomes legally responsible for making sure the individual’s basic needs—such as safety, healthcare, shelter, and financial matters—are met. However, this process involves court hearings, evidence, and strict oversight.

While guardianship can be necessary in some cases, early planning is almost always easier and less distressing for all involved.

One of the more difficult parts of dementia is recognising when someone is no longer safe to manage their finances. Sadly, people with dementia are at much higher risk of falling victim to scams or financial abuse.

Signs that someone may need support with money include:

• Unpaid bills piling up

• Unexplained cash withdrawals

• Unusual spending patterns

• Giving money to unfamiliar people

Families can help protect their loved ones by setting up third-party access on bank accounts (with consent), monitoring transactions, and reporting suspected fraud. An LPA for Property and Financial Affairs can also help prevent serious financial harm.

Despite best efforts, dementia may reach a stage where care at home is no longer safe or manageable. This could be due to:

• Physical frailty

• Wandering or disorientation

• Aggressive behaviour

• Medical complexity

In these situations, memory care units and dementia-friendly care homes can offer a more structured environment with trained staff. Making this decision is rarely easy, but in some cases, it becomes the kindest option for everyone involved.

At Home Instead New Forest, we often work with families to delay or avoid residential care by providing personalised support at home for as long as possible. When that’s no longer enough, we help ease the transition by offering continuity, guidance, and compassion.

Financial responsibility for a person with dementia doesn’t land all at once—it accumulates. A forgotten appointment. A missed payment. A worrying diagnosis. When those early signs appear, that’s the moment to begin planning.

Putting the right legal documents in place—especially an LPA—can protect your loved one’s wishes and reduce anxiety down the line. These decisions are rarely easy, but they are manageable, especially with help.

If you’re facing questions about dementia care, we’re here to support you.

Contact Home Instead New Forest for personal, thoughtful advice about caring for someone with dementia in the way that works best for your family. We can support you in maintaining dignity, independence, and safety—at home, for as long as possible.