Australians are living longer, but a critical and often overlooked risk could disrupt their retirement future. Dementia is affecting people earlier and progressing more quickly, influencing not only medical outcomes but also legal and financial stability well before traditional old age begins. While much focus is placed on saving enough for retirement, a key risk for many is the potential loss of decision-making ability at the very time financial clarity is most needed. Increasingly, diagnoses are occurring in people’s 50s and 60s.
More than 433,000 Australians are currently living with dementia, with nearly two million involved in their care according to national figures. Though dementia is commonly associated with later life, a growing number of cases are being diagnosed in working-age adults. Nearly 30,000 people under the age of 65 have already been diagnosed. As these figures are expected to more than double over the next four decades, the age at diagnosis is becoming a critical factor. Financial decisions made during mid-life may be out of reach later due to legal rules that depend on mental capacity.
Early planning is essential, especially since 60% of people do not have an updated will. Putting in place legal documents such as powers of attorney or estate plans while still mentally capable can be the difference between maintaining control and facing confusion. This becomes even more important given that losing decision-making ability does not just impact future inheritances but can disrupt day-to-day money management.
Dementia is not only a health issue, it is a financial turning point. Its arrival brings multiple costs, including lost income and complicated asset decisions. Having the right insurance in place, securing appropriate legal documents, and talking with family while still able to do so provides strong protection. Without this preparation, families are often left navigating unclear intentions during a time that is both emotionally and financially stressful.
The positive news is that steps taken now can smooth the road ahead. These include listing all assets and debts, confirming legal contacts, and discussing care and financial wishes with family members. Staying mentally and physically active during retirement also helps. People who remain engaged often maintain better cognitive ability, which supports both independence and financial wellbeing into later life.
