Consumer Credit Events Before and After Dementia Diagnosis

Published: 2019


Anecdotal evidence suggests that changes in thinking and memory due to dementia can lead to large financial losses.  We test this using linked Medicare claims and FRBNY/Equifax CCP data.  We find that missed payments increase up to 4 years prior to a dementia diagnosis and persist after diagnosis.  Tracking financial outcomes could potentially contribute to earlier dementia diagnosis or help financial institutions identify suspicious transactions and take steps to protect consumers.

Key Findings

    • In single-person households, difficulties managing money are apparent for several years before a dementia diagnosis.
    • Adverse financial events continue in the years following a dementia diagnosis.
    • The financial behaviors associated with dementia are distinct and more pronounced than those associated with other acute and gradual-onset health conditions
    • Financial data represent a potentially important tool for detecting cognitive impairment and preventing financial exploitation of patients and their families.
    • As additional research clarifies the financial phenotype characterizing early signs of dementia, it may be possible to use data on payments and other financial behavior in conjunction with other clinical symptoms to diagnose patients earlier and engage family and other surrogates in financial decision-making.


Nicholas, Lauren Hersch, and Joanne Hsu. 2019. "Consumer Credit Events Before and After Dementia Diagnosis," University of Michigan Retirement Research Center (MRRC) Working Paper, WP 2019-418. Ann Arbor, MI.