It's no secret that Japan is the world's oldest major economy...
More than 28% of its citizens are over the age of 65. And 1 in 10 folks is 80 or older.
What you may not know is that this group controls nearly half of Japan's annual GDP... That's about ¥315 trillion, or $2 trillion, in financial assets.
The problem is that many of Japan's oldest citizens are experiencing cognitive decline. By 2030, between 10% and 20% of the population will be living with dementia.
As a result, older investors are becoming more susceptible to financial exploitation and fraud.
Today, we'll explain why this "dementia money" is posing a huge risk for global economies and individuals alike... and what you can do to protect your wealth.
The most obvious risk for aging investors is theft...
According to Japanese government data, older adults accounted for 65% of the country's scam-related losses in 2024. (Total losses reached about $462 million that year.)
Yet fraud is only one part of the story...
Cognitive aging affects decision-making long before a formal dementia diagnosis. According to Bloomberg, gradual declines begin around the mid-60s.
And that can lead to things like missed credit-card payments and poor investment choices.
One Japanese study found that people over 60 with cognitive decline held around 40% less financial wealth, on average, than their healthy peers.
On top of that, money is still a taboo subject in many Japanese households. Only about a third of folks over 65 have discussed finances with their children.
Similar trends are unfolding in other parts of the world...
Older adults with dementia hold about $110 billion in assets in South Korea. In the U.S., the figure is around $6 trillion.
And U.S. financial institutions are beginning to take note... Between 2022 and 2023, they reported about $27 billion in suspicious activity related to elder exploitation.
Japanese institutions have also taken action... They've limited elderly account holders' purchases and even frozen their accounts. About 11% of adult children managing these types of finances have struggled with frozen accounts in Japan.
This practice may keep money safe in the short term. But it also removes funds from circulation, meaning families can't withdraw, transfer, or invest them.
All these factors increase the risk of expensive financial mishaps in the future.
That's why investors need to plan ahead...
Aging is inevitable. But you can organize, and control access to, your money long before any cognitive issues arise.
The starting point is simple... Work with a financial adviser you trust. This is the person who helps you figure out goals, next steps, and support if someone needs to step in.
Most people avoid the second step. And it's usually the most important one... Talk about money while family members are still cognitively sound. That means parents should reveal their assets to adult children (or other trusted parties) and document what they have.
This is exactly why we created our Wealth Foundation tool last year. It's completely free and designed to help you or your family get started on the planning process.
The Wealth Foundation tool helps you understand the full picture of your assets, expenses, and future spending. And it forces you to ask the difficult questions. (Please keep in mind that this tool should be used for informational and educational purposes only. It's not intended as personalized investment advice.)
Don't wait until it's too late... Create a road map for your financial assets today.
Joel Litman
January 21, 2026
