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A neighbor who i am getting to know better is a concern to me. This person is not married with no living relatives and no children. Recently learned that dementia is very common in the family. What kind of legal documents need to be written for the protection of his health and home and estate?

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If he has weath, I hope he is using it to enjoy himself now. Big screen tv, awesome computer, other toys. Trips and excursions and season tickets to sports and/or concerts.
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It seems to me that he has several close assocations
Most of his surviving family are some distance
Just now developing trust in our frienship
There are persons who are skeptical when asked about their future
especially where estates, wealth and businesses are concerned
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I've known many seniors in this position. If they live in a senior community, there are usually others who look out for them. It is a nice arrangement that tends to spring up naturally when older people live together. If an elder (or other disabled) person has trouble in the general community, a concerned friend or neighbor can contact their county human services and let them keep an eye on what is going on. The state can become guardian if it is needed.

It is sad to be alone in the world.
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Does he have close friends? He can appoint any willing person POA and/or Medical Proxy. He should spell out his helathcare wishes in as much detail as he can muster in an advance directive. He should decide where he wants his estate to go upon his death and make a will (in case he has any estate left at the end.)

How old is he? It might not be a bad idea for him to check out assisted living places, to get an idea of what is available, and to discuss his wishes with close friends.

Even if dementia is "very common" in his family that does not mean he is likely to develop Alzheimer's. Hereditary risk depends on type of dementia, age of onset, and other factors. But in a sense, we are all likely to develop dementia if we live long enough. I understand that approximately 50% of people who reach age 80 develop dementia! And, of course, there are lots of other debilitating diseases that can strike as we age. So your friend is wise to plan ahead for the "what if" cases, but I hope he is not unduly pessimistic about his future just because many relatives had dementia.

You are kind to be concerned.
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