Financial exploitation and financial capacity issues often overlap when a gerontologist assesses whether an older adult’s financial decision is an autonomous, capable choice. Our goal is to describe a new conceptual model for assessing financial decisions using principles of person-centered approaches and to introduce a new instrument, the Lichtenberg Financial Decision Rating Scale (LFDRS). We created a conceptual model, convened meetings of experts from various disciplines to critique the model and provide input on content and structure, and select final items. We then videotaped administration of the LFDRS to five older adults and had 10 experts provide independent ratings. The LFDRS demonstrated good to excellent inter-rater agreement. The LFDRS is a new tool that allows gerontologists to systematically gather information about a specific financial decision and the decisional abilities in question.
Using cross sectional data Psychological vulnerability was identified as a correlate of older adult’s being defrauded. We extend that research by examining fraud prevalence using longitudinal data from the Health and Retirement Study, and to identify the best predictors of fraud longitudinally across a 4-year time frame. Whereas reported fraud prevalence was 5.0% in a 5-year look-back period in 2008, it increased to 6.1% in 2012. The rate of new-incident fraud across only a 4-year look-back was 4.3%. Being younger-old, having a higher level of education, and having more depression significantly predicted the new cases of fraud reported in 2012. Psychological vulnerability was a potent longitudinal predictor of fraud, with the most vulnerable individuals being more than twice as likely to be defrauded. Results indicate that fraud victimization among older adults is rising, and that vulnerability variables, along with some demographic variables, predict new cases of fraud.
This study examines preliminary evidence for the Lichtenberg Financial Decision Rating Scale (LFDRS), a new person-centered approach to assessing capacity to make financial decisions, and its relationship to self-reported cases of financial exploitation in 69 older African Americans. More than one third of individuals reporting financial exploitation also had questionable decisional abilities. Overall, decisional ability score and current decision total were significantly associated with cognitive screening test and financial ability scores, demonstrating good criterion validity. Financially exploited individuals, and non-exploited individuals, showed mean group differences on the Mini Mental State Exam, Financial Situational Awareness, Psychological Vulnerability, Current Decisional Ability, and Susceptibility to undue influence subscales, and Total Lichtenberg Financial Decision Rating Scale Score. Study findings suggest that impaired decisional abilities may render older adults more vulnerable to financial exploitation, and that the LFDRS is a valid tool for measuring both decisional abilities and financial exploitation.
Objectives The objectives of this study were threefold: (1) to empirically test the conceptual model proposed by the Lichtenberg Financial Decision Rating Scale (LFDRS); (2) to examine the psychometric properties of the LFDRS contextual factors in financial decision-making by investigating both the reliability and convergent validity of the subscales and total scale, and (3) extending previous work on the scale through the collection of normative data on financial decision-making. Methods A convenience sample of 200 independent function and community dwelling older adults underwent cognitive and financial management testing and were interviewed using the LFDRS. Confirmatory factor analysis, internal consistency measures, and hierarchical regression were used in a sample of 200 community-dwelling older adults, all of whom were making or had recently made a significant financial decision. Results Results confirmed the scale’s reliability and supported the conceptual model. Convergent validity analyses indicate that as hypothesized, cognition is a significant predictor of risk scores. Financial management scores, however, were not predictive of decision-making risk scores. Conclusions The psychometric properties of the LFDRS support the scale’s use as it was proposed in Lichtenberg et al., 2015. Clinical Implications The LFDRS instructions and scale are provided for clinicians to use in financial capacity assessments.
The relationship of cognition to perceived social support (PSS) was examined in a sample of 188 older medical patients who lived alone before admission to the hospital. Most of the patients were African American, and a majority (54.3%) was classified as cognitively impaired based on their performance on the Mattis Dementia Rating Scale. Compared with cognitively intact elders, impaired participants reported lower overall PSS as well as lower PSS in their relationships with friends and significant others. These findings suggest that cognitive functioning is an important factor in influencing older, medically ill African Americans'perceived social support. Possible risk factors for low PSS and the role of cognition in friendship and maintenance of a social support network are discussed. Older adults who live alone typically have fewer medical conditions and fewer cognitive deficits than does the general population of older adults (Mui & Burnette, 1994), yet there remain substantial numbers of older adults who manage to live alone with mild, moderate, and even severe cognitive impairment. Research on a sample of 372 predominantly African American older adults who lived alone prior to admission to a medical rehabilitation hospital indicates that 38.9% scored in the impaired range on a measure of global cognitive functioning (MacNeill & Lichtenberg, 1997). Impaired cognition has also been associated with depression (Cervilla & Prince, 1997), lessened ability to perform self-care tasks (Heaton & Pendleton, 1981), greater 437
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