When I was a kid my mother always told me to listen to older people when I needed advice. When you're 70 it gets harder to find older people but, young feller, you've lucked out.
I know exactly what's happening to you, although I don't know what causes it. You'll need somebody with a Ph.D in gerontology for that.
I started to lose it a bit in my early 70s and if I was the worrying kind I'd have thought Al Zheimer and his foggy friends were knocking on my door. I started talking to other geezers (and geezerettes), and I learned as much as I could from this wondrous thing we call the Internet.
I've been known to start a conversation with Mrs Didge, thinking that she was n the room with me, and learning that it was only my imagination. I'm not talking about absent-mindedness, forgetting that she was in the garden but, like you, I could have sworn she was there.
I used to worry about my mental lapses -- I struggle for words I've used all my life, my ability for mental arithmetic has gone down the gurgler, and my memory has a bad case of acne. So I still do the things I can, I still enjoy myself, and I don't fret about changes that are beyond my control.
I don't think you're going nuts and there's no reason to think that illusions like yours are an indication that dementia is lurking around the corner. Talk to some other old people and compare notes. You'll find you're not alone.
And while you're likely to laugh at this song there's a sharp side to it, too, because it happens to most of us:
Well, like I said I'm 70 and live alone. I think I'm balanced so far as my mental state goes. I can carry on a decent conversation with anyone as far as I know. My main concern was thinking someone is there and knowing they are not but I try to talk with them anyway. I'm retired and live a normal life or at least i think i do. I try and go to Vegas for my birthday then again in Jan. (6 mths later). I take different meds but nothing serious. I'm not diabetic and have been thinking about that Barotic Surgery to lose weight.