(MONEY Magazine) – Signposts are still taped to the doors in Ellen Aurbakken's Dallas home: a large white card on the entrance door reads FRONT DOOR; another on the back door says TO GARAGE. She put them up several months ago, when her husband Hans became too disoriented to find his way around their seven-room ranch house. In 1986 Hans, who had retired six years previously after a 43-year career in the Methodist church, was diagnosed as suffering from Alzheimer's disease, the incurable brain disorder that causes increasingly irrational behavior and leads to death. Last fall he started having fits of belligerence, finally becoming so unmanageable that Ellen had to put him in a nearby nursing home. When she brings him back to visit their house, she says, ''He hardly knows it was his home.'' Hans Aurbakken, 74, is one of 2.5 million Americans suffering from the disease that is often simply, and chillingly, called Alzheimer's. And he, his wife and the rest of his large family (six grown children, nine grandchildren) are among the even greater numbers who must cope with the enormous emotional and financial strains of the disease. Most of its victims are elderly; in fact, they include 7% of the U.S. population over 65, with men and women equally likely to be stricken. The causes of the disease are unknown, though researchers have suggested links to such varied factors as heredity, a virus and aluminum. After the first symptoms appear -- usually significant memory loss, trouble finding words and poor judgment -- a patient lives on average eight more years. (Contrary to some older Americans' fears, simple forgetfulness is rarely a symptom of the disease.) The expense can be staggering. If the person must be moved to a nursing home, the cost averages $26,000 a year. Typically, less than 2% of that amount is covered by Medicare. A relatively new option, nursing-home insurance, is available in most states, but it is expensive -- $1,000 or more a year at age 65 -- and must be bought before the onset of the disease. Even then, many policies do not cover the mentally ill. Once Alzheimer's sets in, a family's only recourse may be to deplete their savings and sell assets until they qualify for Medicaid, the government-paid medical program for the poor. Luckily, the Aurbakkens' assets are substantial. Their most valuable holding is a rustic three-bedroom house in the Berkshire Hills town of Tolland, Mass. that they built for $75,000 in 1974 with retirement in mind. Judging from the recent selling prices of comparable houses in the region, Ellen figures the house, which they visit each summer, is worth $200,000 now. She estimates that the couple's Dallas house, which she enhanced last year by spending $4,000 to repair some damaged floors, is worth about $130,000. Like most homes, its rooms hold mementos of the owners' life together. It has been an unusually full one. After a boyhood in Norway, Hans spent 29 years in Algeria as a United Methodist Church missionary. During those years, he and Ellen, 64, raised six children, one of whom, John, 31, a nurse, lives at home. Photographs of the other children and the grandchildren hang on the walls beside North African rugs and faded photos of Hans' seafaring ancestors. These days the dining room table is often littered with bills, insurance forms and other financial documents that Ellen spends hours reviewing in an attempt to get a handle on her cash flow. Hans was always the money manager, until his illness. She was poorly prepared for the job, and it has grown more complicated as her husband's condition has worsened. Last year the Aurbakkens' income was mostly from Social Security and Hans' church retirement benefits. Interest, dividends and a surprise tax refund rounded out the sum to $30,838. The $5,167 windfall from Uncle Sam came after the Aurbakkens, on the advice of their accountant, filed amended returns for 1983 and 1984 because they had overlooked a valuable housing-related deduction. Ellen contributed only $781 of the couple's income. Trained in phonics, a method of teaching reading based on word sounds, she earns $20 an hour tutoring grade-schoolers. But looking after Hans left her time for only a couple of pupils last year. Over the 12 months, Hans' expenses for medical treatment, a housekeeper- nurse and a day-care center rose to $7,786 -- 25% of the couple's income. And boosting the couple's furniture bill was $1,700 for a king-size bed to replace their double bed. It became too worn and small for them after Hans, increasingly troubled by sleeplessness, began thrashing about restlessly and getting up to wander the house at night. ''I'd have to follow him around and slowly coax him back to bed,'' says Ellen. As Hans' condition worsened, the accountant advised putting the family's life insurance in order. He suggested repaying $9,560 they had borrowed against their five whole life policies. His reasoning was that the loans carried higher interest rates (about 8%) than the policies were earning (about 4%), and the new tax law was phasing out deductions for consumer interest expenses. The policies, which were bought in the 1950s and '60s, insure Hans for a total of $75,000 and Ellen for $65,600. But making the repayments plus meeting the blizzard of bills forced Ellen to dip into savings. By year-end she had withdrawn $15,929. The remaining cash holdings of $87,743 are distributed among three certificates of deposit and four money-market accounts -- a scattering that Ellen attributes to Hans' weakening judgment while he was still handling the finances. She also owns $15,993 of stock in First Union National, a bank holding company in Charlotte, N.C., and in the phone company GTE. The rest of her savings consists of $21,467 in tax-deferred annuities and a $6,968 Individual Retirement Account invested in bank CDs. All together, the value of the Aurbakkens' houses and other investments totals $462,171. If she had no need to pay for her husband's care, Ellen would find these resources quite adequate. ''Missionaries are not supposed to have much money,'' she points out, ''and we have more than most simply because I inherited it.'' The only child of a Sanford, Fla. celery farmer and a homemaker, she had just graduated from Ohio Wesleyan University in 1945 when, influenced by a close friend who had done church work abroad, she entered Connecticut's Hartford Seminary to prepare for missionary work. There she met Mary and Hans Aurbakken, missionaries from Algeria who were at the seminary with their three daughters for a year or two of study. ! Hans, whose father was a fjord pilot, had been raised in the Norwegian city of Stavanger and was a 1935 graduate of the Scandinavian School of Theology in Goteborg, Sweden. In El-Biar, a suburb of Algiers, he and Mary had run a boys' home until bombings during World War II forced them to shut down. The U.S. Army then installed a Signal Corps unit on the grounds but allowed the family to live there until the war's end in 1945. Ellen and Mary had become good friends when Mary suddenly died following gall bladder surgery. Hans and the children returned to Norway and eventually Algeria, where he again became director of a boys' home. But he and Ellen corresponded, and in 1948 she married him. Apart from occasional furloughs in the U.S., they lived in Algeria for the next 18 years, raising a daughter and two sons of their own. When the Aurbakkens were recalled to the U.S. in 1966, Hans went into high- level administrative work with the church's Board of Global Ministries in New York City. By that time, Ellen had come into the roughly $500,000 inheritance that eased the family's finances. They bought a house in suburban Teaneck, N.J. and sent the three younger children to college with relatively little strain. In 1980, Hans retired from the board, where his last title was associate treasurer. He and Ellen moved to Dallas instead of Massachusetts because, she explains, ''three of our children lived here, and Hans preferred city living to the country.'' They realized $90,000 from the sale of their New Jersey home and paid about $93,000 for their present house, putting down all but $15,000 and assuming a 5% mortgage. Retirement was uneventful until March 1986, when Hans first exhibited a symptom of his disease. Ellen had asked him to pick her up at a school where she was tutoring, but he never arrived. He came home hours later explaining that he somehow made a wrong turn and found himself driving through downtown Dallas, unable to remember the way to the school. ''That scared us both,'' recalls Ellen. Soon he was having trouble recognizing the bedroom when he awakened and was confusing his son John's room with his own. Later in the spring he started having delusions about who Ellen was, at which point she took him to a psychiatrist. The doctor's psychological, neurological and physical tests led to a diagnosis of Alzheimer's. On the advice of friends, Ellen got Hans to sign a general power of attorney, which, when notarized, permitted her to act for him in all circumstances. Meantime, Hans became increasingly difficult, abruptly stalking out of the house when displeased or, at other times, just as arbitrarily refusing to leave it. Still, she resolutely continued living with him. Last May she even took him to Norway for a visit with his siblings, a trip for which son John paid the air fare. Hans was well enough to spend the summer with Ellen at their home in Massachusetts, but once back in Dallas he became so intransigent that she agreed with his doctors that he should enter the nursing home. The monthly fee is $1,800, of which the Methodist Board of Global Ministries covers 66%, leaving only $600 for Ellen to pay. She visits Hans every evening and takes him out for restaurant meals twice a week. Afterward, alone in her living room, she frequently mulls over how to raise the money to ensure Hans' welfare -- and her own. The Aurbakken children, including a son who owes his parents $8,000 on a personal loan, have agreed to help with their father's expenses. But last year, pinched by their own financial problems, only three of them could afford to chip in a total of $1,000. Aware that she is spending more than $3,200 annually on utilities, taxes and other items to maintain the Massachusetts house, Ellen sometimes thinks of selling it. But she invariably rejects the idea. ''The children want to keep it in the family for future use, and so do I,'' she declares. Nor can she bring herself to sell Hans' 1982 Mercury Lynx, even though she spent $800 last year repairing it. Choking up in a sudden and rare loss of control, this spirited, disciplined woman blurts out tearfully: ''It was the last car Hans bought.''

BOX: Bottom Line

Ellen Aurbakken boosted the couple's net worth in 1987 by repaying insurance loans, which cut their debt to a modest mortgage balance plus a few small bills.

INCOME Withdrawal from savings $15,929 Hans' pension and Social Security 14,648 Interest and dividends 10,242 Tax refunds 5,167 Children's contributions 1,000 Ellen's earnings 781 Total $47,767

OUTGO Life insurance loan repayments $9,560 Medical bills and insurance 4,560 Food and clothes 4,160 Floor refinishing 4,000 Massachusetts house costs 3,237 Utilities 3,184 Charitable contributions 2,790 Housekeeper-nurse 2,720 Furniture 2,500 Mortgage and property tax 2,160 Vacations 2,022 Car expenses 2,000 Hans' day care and nursing home 1,863 Miscellaneous 1,124 Taxes 927 Life insurance 595 Homeowners insurance 365 Total $47,767

ASSETS Houses $330,000 Savings 116,178 Personal property 22,000 Stock 15,993 Debt receivable 8,000 '81 Buick, '82 Mercury Lynx 2,950 Checking account 1,518 Total $496,639

LIABILITIES Mortgage $7,677 Bills 917 Total $8,594

NET WORTH Total $488,045

BOX: The Advice Untangle your personal finances

-- THE PROBLEMS How to raise more money from the couple's assets and manage cash flow better.

-- THE SOLUTIONS 1. Sell a house, car and stock. 2. Exchange low-paying insurance for annuities. 3. Reduce the number of CDs and money-market accounts.

Certified financial planners Bill E. Carter and Martin Cohen met with Ellen Aurbakken in Dallas recently at MONEY's invitation and made the following recommendations: Asset allocation. Ellen should decide which of her two houses she wants to live in and sell the other. She cannot afford to pay for an empty house, and ultimately she will need the money from the sale. But she shouldn't automatically sell the Massachusetts place. Even in Dallas' depressed market, homes in the $130,000 price range are selling, and while waiting for a buyer, she would have little trouble renting out the house. She should also sell one of the couple's two cars, especially since both are getting old and costly to maintain. And she should take advantage of the next market rally to sell her First Union National stock, which is yielding a low 4.3%. For a higher yield, Cohen suggested investing her stock sale proceeds (about $11,000 at recent prices) in a single-premium annuity like Fidelity Bankers Life's Pilgrim Index Rate Annuity. It pays a guaranteed 8% for five years and adds an annual bonus as an inflation hedge if in any single year the average rate on 90-day Treasury bills, lately 5.73%, rises above 9%. Ellen could borrow against her accrued interest without penalty at any time. She should also exchange the couple's low-yielding whole life policies for higher-paying annuities. Improving money management. To make keeping track of her savings easier, Ellen should consolidate her four money-market accounts. For convenience, she should have one at a local bank and, for a higher yield, one at a mutual fund. Recently, money-market mutual funds were paying a full percentage point more than money-market bank accounts (6.92% vs. 5.82%). She should also combine her three bank CDs, when they come due, into one. Her need to simplify her finances overrides the customary benefit -- protection against interest-rate changes -- of staggered maturities. Keeping her IRA in CDs until she needs the cash is a good idea because at her age she should avoid riskier investments. (When she reaches 70 1/2, by law she must begin withdrawals.) But unless her income from teaching rises dramatically, she should make no further contributions to her IRA, since the tax benefits would not be significant in her 15% tax bracket. With last year's one-time $15,260 expense for loan repayments, floor refinishing and a new bed behind her, Ellen should be able to get by on her income of about $25,000 for at least the next two years, particularly if the children help with the $7,200 yearly nursing-home bill she now pays. She should use the time to learn more about managing the family finances and to consider carefully which house she wants to settle in. Above all, she should not make major decisions until she sees how well Hans fares in the nursing home he has so recently entered. The advisers counseled a six-month wait, at the end of which Hans' condition might help her determine which course to take.

Ellen made exchanging the Aurbakkens' insurance for annuities her first priority. In spite of being counseled to go slow, she also quickly decided she would move to the Massachusetts house and is planning to spend the summer scouting nursing homes for Hans. But she worries that she and Hans will then no longer be close to their grandchildren. ''Whether they'd come to visit us in the summer I don't know,'' she muses. ''And that's one of my husband's problems -- he's always asking, 'Where are the children?' ''

BOX: Help Resources for families

For more information about coping with Alzheimer's disease, you can write to the Alzheimer's Disease and Related Disorders Association (ADRDA), a nonprofit, national organization, at Department 2A, P.O. Box 5675, Chicago, Ill. 60680. ADRDA dispenses free information on caring for victims as well as on services and legal options for their families. ADRDA's 174 local chapters run support groups; to join one, call toll-free (800-621-0379) to learn which chapter is nearest you. Other sources of help include your state's or local government's office on aging or senior citizens services; your state bar association for legal referrals; and your local Legal Aid Society for low-cost legal counseling.