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If you can focus on what's best for FIL, that might be a better approach. Then you're not putting yourself or your wife first, but rather your FIL. And he IS the one who needs care.
It also wouldn't hurt to do some research on Alz, as eventually it may become more than just desirable, it may become absolutely necessary. Starting that planning now would be wise.
You do raise a good question, though, one with which many of the posters here, including myself, have battled. I don't know if there is a standard answer. Every party should have equal rights and treatment, but often with a parent who has dementia that ratio changes and becomes weighted in favor of the elder.
In an ideal world, we each would have the same level of rights, but it's had to balance that.
But theory doesn't answer your question. I've written before that I see these situations as graphs, in your case with your FIL's welfare represented by a diagonal line which is increasing, and yours represented by a decreasing diagonal line. The point at which they crossed has obviously been reached and your welfare is decreasing. So it is time to restore some balance.
I do think it's time for your FIL to move, especially since there's a lack of marital privacy. And yes, you do have a right to want to move on, as well as to have the benefits of your marriage restored to you without another party present all the time.
And I think you recognize that your wife is probably concerned with her father on an emotional and protective level that might be stronger at this time, because of his needs and not because of any diminution of concern for your. Her father's just in a worse place right now.
One thing that might help is to call facilities before touring them to find out when they're having activities that might interest him, especially the musical ones. There's a dynamic, a special feeling in the specific room, almost a sense of adrenalin rush, when the musicians come to play. It might encourage him to think more positively about a facilitiy.
Good luck, congratulations for being able to accomplish this change in approach, and please keep us updated. It's always encouraging when something works out for the best.
Move forward. You, your wife and your FIL deserve as full a life as you all can handle.
https://www.agingcare.com/questions/want-life-marriage-back-cant-care-for-mom-186396.htm
You need to move forward with plans to move your FIL. There will come a time that any change is living situation will become very difficult for him and thus you and your wife. The earlier in dementia a move occurs, I believe, the easier on our loved ones. Soon enough it is easier for them to get involved and make friends, participate etc.
Your FIL is not going to get "more ready". He's declining and will be LESS able to adjust as time goes on. Does she realize this?
Is this a matter of someone (you, her) thinking that she'll have to back to work if he goes to AL? It sounds as though there is something strong that is interfering with her doing what is in her dad's best interests.
As his dementia worsens, she's not going to be able to care for him at home alone. You are going to need three shifts of caregivers. So, so much better for him to be in AL where he'll actually have more control over his life.
I wish you the best in dealing with this.
You might want to pursue the issue of why she thinks she is "giving up" by finding a placement for him.
Are there any friends in your area who've gone through this and can explain that sometimes the point is reached when home care can't be provided? Any relatives who can help her see that she's NOT giving up but rather pursuing a different path of care? Can you think of an analogy on handling some other issue, perhaps with children or co-workers, when one strategy is no longer effective and another has to be pursued? Does she understand the meaning of mid-course correction?
And is she aware of how FIL's behavior is affecting you, especially when he disrupts your sleep? If it affects your ability to be alert at work, then it's reached the point discussed earlier in this thread, that his behavior is affecting your ability to provide for your family.
The other issue is whether being home alone and at loose ends is at all helpful given that his sister has cancer. And it's not. He needs distraction, and he's not going to get it at home. If he were in IL, at least he'd be with other people.
Some questions to ask her:
1. Does she realize how unhappy he is now? Does she think that's fair to him, to hold back based on what she interprets as her need to continue to keep him in your joint home?
2. What factors exist that make her think she's "giving up?" Without being facetious, she's not kicking him out to live under a viaduct; she's making good, helpful arrangements for him.
I think the point is how to make her realize that she would be helping him not hurting him, and right now, it seems no one is being helped.
I wish you luck; this isn't an easy situation.