Hello Savanthar,
this is something I have thought about a lot. Since you are someone who believes in the afterlife as such, I dont have to go into why we can still have a soul even though it is not apparent if you get hurt a lot in the head (or have bad dementia of any kind).
I`ve come to these conclusions:
Either your soul is never hurt AS your soul, but since we are meant to live this life to the max in this body, you truly do feel the degeneration and get hazy and "lost" before death. Then, after death, your soul would be complete and healthy again (just like physical injuries are, I hear, cured), but you are so used to the dysfunctional state of mind that you cannot readily move on or "think yourself" into a better place because you have become unused to this kind of thinking. In this case, a retrieval or helpers will eventually get you and show you the way to a better place (or a place of healing?). Some things I read in Bruces` books seem to suggest that this is, indeed, the case - think of the old woman with Alzheimer that he helped retreive who still "sat" in the afterlife in "her" chair surrounded by the weirdness she had become accustomed to. The helpers took on the appearance of old-people`s-home nurses and helped her get on (although it is not said where she went, possibly only the helpers and she know).
OR you are healed straight away and resume your "normal" thinking and soul-life you had before you became too ill. While this seems an attractive option, I think the first option is far more likely since the spirit world seems to be shaped largely by your own thinking you have at the time of death.
OR, and I believe this will be true for some people, you have become one with the world-soul already before death by "becoming like the children". I sometimes wonder if these "mentally ill" old people who sit around quite happily and smile a lot and are gentle, but just are not "who we are used to" have not really just moved on to a different state of being which they will maintain (only better) once they have lost the physical body.
Or, indeed, there is no soul except what is contained in our physical brain, but in this case, this world is too sad a place to think about in the first place and it won`t help anyone to believe this.
Hope this could give you some positive paths to think
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Christiane