Protecting Your Family - Protecting Your Legacy


As you prepare for retirement, you’re probably more focused on financial planning for yourself, such as making sure you have enough money to live comfortably in your last stage of life. However, it’s important to sit down and consider crucial things such as a living will, a power of attorney and a health care attorney in case you have a sudden stroke or accident that leaves you unable to make decisions for yourself.
If you’re retired or planning for an upcoming retirement, you probably already know that you should have a will or trust set up, but maybe you’ve been putting it off for whatever reason. Alternatively, you may also need to revisit a plan you set up several years ago as circumstances have changed. Whichever case yours may be, the good thing is that you’re thinking about your estate plan, and now’s a good time to act on those thoughts.

Long Term Care Insurance

I want my clients to be prepared in all aspects of their life, in addition to estate planning; the lifetime chances of residing in a nursing home increase the older you get. This means, however, there is a fairly good chance that either a husband or wife may need nursing care at some point in their lives. There is actually a much higher chance of needing nursing care than of your house burning down or being blown away in a tornado, yet we all purchase homeowners insurance. There also is a much higher chance of needing nursing care than of having a large liability from an auto accident, yet we all purchase auto insurance.

Medicaid and Estate Planning

If a person needs nursing care and has exhausted all of their assets, then the state will pay for their nursing care. However, their assets must be spent down to less than $2000. Some items do not count, such as prepaid funeral plans, household goods, and a home if you plan to return to it. Other things disqualify you from Medicaid, such as too many assets and gifts. The look-back period is 60 months, and gifts within this period disqualify you from receiving Medicaid. Gifts prior to the look-back period are not counted against the applicant.
There is a system for dividing assets when one spouse needs nursing care and the other spouse does not. They allow you to divide the assets, and when the care-needing spouse has spent down their assets, Medicaid takes over. Whenever Medicaid pays for a person’s care, a lien arises for the amount expended against the property of the person and the person’s spouse. This lien is not enforceable until the death of the person or their spouse. The Medicaid rules change often and care should be taken to seek competent advice prior to making any of discussed changes.

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