Mom is showing signs of dementia. How do we manage this?

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My mom has lived with my family and I since 2009, since my dad passed away Nov. 2008 She had a brain anerisum in 2001 and as a result has short term memory loss. We are in the process of having her assessment done and hopefully find placement for her in a more suitable situation. She recently fell and broke her arm and as a result I have had to be more hands on. On a recent trip to the hospital, complications from the fall, I noticed she stashed envelopes of cash in her open sweater pockets! Who knows how many times she has done this and perhaps lost money. She hides this money in her room and takes it when she goes somewhere, I guess. So far though, she doesn't seem to remember that she had it at one point. ( I took it home for safe keeping, as she stayed a couple days in hospital). My question is, do I continue to keep it for safe keeping, or return it to her, explain the situation? She can't be stashing cash if she lives in a care facility! I don't have power of attorney yet (something else we are working on) I have also noticed other things with having to help her more closely, like she hoards plastic bags under her desk or hides granola bar wrappers in her pants pockets. The pants she put away, after changing for the night, the wrappers are found the next day. Any suggestions about the cash situation?

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I also kept cash in my dad's wallet when he was in the NH. Sometimes it was there when I checked, sometimes it was gone, I never knew what happened to it and he couldn't tell me but I'd replenish it. A $10 and some singles usually satisfied him. Don't let her carry more than she can afford to lose and just think of it as disposable because she probably won't be able to keep track of it. It's literally the price we pay to preserve some of their dignity.
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Adults don't feel prepared for life if they don't have some cash on their person. Most women carry our purses everywhere, even when we don't expect to need money. Men are the same about wallets.

To help our mother (dementia, in NH) with this, we saw to it that she always had a small amount of paper cash in her purse. $5 or $10 would do. Not enough to be a catastrophe if she lost it or it was stolen, but enough to satisfy her.

For my husband, it was a matter of removing credit cards from his wallet. I talked him into this with "identity theft" talk. He didn't know what that was but he heard it often enough to believe it was real. He also carried a small amount of cash with him.

In this as in so many adjustments we have to make for dementia, the goal is to keep them safe without injuring their dignity.
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